1

INTERNATIONAL LEISURE TRAVEL TRENDS 2018

AUSTRALIANSon HOLIDAY

A report by

OCTOBER 2019

2

Australians are renowned as passionate and adventurous travellers, but what really makes them tick?The Council of Australian Tour Operators’ (CATO) Australians on Holiday – International Leisure Travel Trends report is designed to help key stakeholders – including travel professionals, government bodies and media – understand just that.

Drawing on information compiled from the Australian Bureau of Statistics for 2018 and an independent consumer survey¹, the report provides fresh insights into the scale, nature, contribution and potential of Australia’s outbound leisure market.

The inaugural report shows that in 2018, Australian holidaymakers:

• took 6.3 million overseas leisure trips (representing a market penetration of 25.1%)²

• spent more than AUD$46 billion in total and an average of AUD$7,300 per person

• visited an average 3.4 countries per trip

• enjoyed an average journey length of 22 days.

It also shows that South East Asia was by far the most popular region for a break, accounting for 35% of all holiday departures – more than the combined total of the next two most popular destinations, Oceania (16%) and Europe (16%).

In terms of most popular countries, Indonesia sat head-and-shoulders above the competition as the primary choice of destination, attracting 55% more holiday visitors than the United States, which placed second, and more than double that of third-placed New Zealand. Overall, Asian destinations filled nine of the top 15 holiday destinations in 2018.

Future reports, using comparative data, will reveal holiday trends across all key areas, but in 2018 we can already identify interesting differences between age groups. In particular, a greater tendency for older travellers (51+ years) to operate with larger holiday budgets, take longer breaks and explore long-haul destinations such as Europe.

At the same time, the report highlights a propensity for travellers who have entered retirement - a group set to expand significantly over the next decade - to gradually take fewer (albeit longer) overseas trips.

EXECUTIVE SUMMARY

3

PASSIONATE TRAVELLERS

Holiday 57%

VFR 26%

Business 13%

Other 4%

Australian holidaymakers enjoyed a total of 6.3 million overseas leisure trips³ in 2018, representing 57% of all outbound departures.While Australians aged 18-35 years were the most active travellers in 2018, the appeal of an overseas holiday was strong across almost all age groups.

With the exception of children aged 17 years and younger, each age category’s share of total leisure trips correlated to its share of the total Australian population.

Demand only began to taper off once travellers moved into the 71+ age bracket.

Holidaymakers by age

Outbound travel 2018

30%

25%

20%

0%

5%

10%

15%

0-17 18-35 71 +61-7051-6036-50

22%

26%

20%

12%10% 10%

15%

28%

23%

16%

13%

6%

% AUS population

Age

% of holiday trips 2018

4

FAVOURITE HOLIDAY HAUNTS

Asia accounted for half of all Australian holiday breaks in 2018. South-East Asia was by far the most popular region, welcoming 35% of all leisure trips – more than the combined total of the next two most popular destinations, Oceania (16%) and Europe (combined 16%). Australian travellers’ affinity with Bali helped Indonesia comfortably secure top spot as the most popular country for a holiday⁴, followed by the USA and NZ. As expected, short and medium-haul countries across Asia and the Pacific dominated. Holiday preferences were fairly consistent across all age groups with two exceptions: South East Asia and Europe.

South East Asia 35%

North East Asia 6%

Oceania 16%

The Americas

14%

South & Central Asia 9%

North West Europe 9%

Southern & Eastern Europe 7%

Other 4%

Holiday market share by regions

Destination region by age

30%

25%20%

0%

5%

10%

15%

37%

35% 39

%

% v

isiti

ng

35%

30%

35%

40%

27%

12% 15

%13

%20

% 24% 26

%

South-East Asia Europe

0-17 18-35 71 +61-7051-6036-50

South East Asia’s allure steadily waned once Australians passed the 50 year marker, while Europe’s appeal intensified. With European holidays generally requiring more travel time and

larger budgets, it seems natural it would draw older Australians less likely to be burdened by family dependents and financial debt.

5

1081

Top 15 holiday destinations by country*

Canada 106111India

Hong Kong 116123Malaysia

Italy 193203China208Vietnam

ThailandJapan

United KingdomFiji

Singapore

IndonesiaUSA

New Zealand

222266

300333

449612

697

0 12001000800600400200Number of trips (‘000)

* Ranked by primary destination (country in which traveller spent most time)

15-30 days35%

7-14 days39%

<6 days11%

1-2 mths11%

AVERAGE22 days

3.4 countries

More mature travellers preferred a slower pace, with more time allotted to fewer destinations

Australia’s distance from most overseas destinations translated to relatively long holiday breaks with the average overseas trip lasting 22 days. With the exception of a dip for Australians aged 36-50 years,

holiday length steadily increased in line with age category.

The most significant jump occurred once travellers moved into the 51-60 year age group.

TIME & MONEY

Holiday duration

Australians visited an average of 3.4 countries per trip in 2018. Older travellers (51-70 years) tended to focus on fewer countries than those aged 18-35 years. Given they also spent longer on holiday, the findings suggest more

mature travellers preferred a slower pace, with more time allotted to fewer destinations. Based on the findings, older travellers appeared more likely to be returning to favourite countries to pursue more in-depth exploration.

FAVOURITE HOLIDAY HAUNTS

6

In total, Australians spent just over $46 billion on overseas holidays, with the average traveller spending just over $7,300 per trip. This figure includes airfares, accommodation and transport, along with additional expenses prior to departure and while travelling.

The biggest spenders were those aged 51-60 years and 18-35 years. Holiday expenditure dipped significantly for travellers aged 36-50 years in line with social trends that imply peak financial pressures, young family commitments and time constraints.

Holiday duration by age group

18-35

36-50

51-60

61-70

71+

16.2

13.8

21.5

24

27.3

0 252015105Average number of days on holiday

18-35

36-50

51-60

61-70

71+

4.9

3.4

2.0

2.2

3.1

0 54321Average number of countries visited

TIME & MONEY

Number of countries visited (per trip)

Average spend (per person)

$7600

$7400

$7200

$6400

$6600

$6800

$7000

$7722

$6677

$7790

$7205

$7017

$8000

$7800

18-35 71 +61-7051-6036-50

Age

7

Australians utilised multiple forms of land-based holiday transport⁵ last year, including rental vehicles, rail journeys, coach tours and bus trips. The average traveller reported using 1.6 different modes of land-based travel during their overseas leisure break.

ON THE MOVE

Travellers in the 18-35 year group were most likely to travel by coach/bus, with 36% including an element in their international itinerary.

Land-based transport30%

25%

20%

0%

5%

10%

15%

Car orMotorhome

Coach/BusRail

28%

23% 22%%

trav

elle

rs w

ho u

sed

Coach/Bus travel by age group

18-35

36-50

51-60

61-70

71+

36

16

12

16

25

0 252015105% Holidaymakers

30 35

Coach/Bus travel: average number of days

18-35

36-50

51-60

61-70

71+

5.7

6.6

7.9

14

11.1

0 108642Number of days

12 14

Average 7.4

However, these travellers took shorter duration trips, suggesting a skew towards more point-to-point travel.

Travellers aged 61-70 years embarked on considerably longer coach/bus excursions (14 days, almost double the average).

8

Travelled in group

77%Travelled alone 23%

Solo travellers accounted

for 23% of all holidaymakers

in 2018

Almost a quarter of Australians travelled alone on a holiday in 2018, while the remainder holidayed with a spouse, partner, friend or in a family group.

ON THE MOVE

By comparison, the percentage of Australians travelling by themselves on an overseas sojourn remained consistent across all age groups.

Travel: solo versus group

As expected, family travel peaked for those aged 18 to 50 years of age, with a dramatic decline once Australians moved into their 50s.

Solo travellers

18-35

36-50

51-60

61-70

71+

21

22

23

26

26

0 252015105% Holidaymakers

30

Family travel

18-35

36-50

51-60

61-70

71+

42

44

15

10

11

0 252015105% Holidaymakers

30 454035

9

Just over 40% of Australian international holidaymakers started planning their break between three and six months prior to departure, with a quarter beginning the process less than three months before their trip began.

Considering the cost, duration and distances travelled, the number of travellers who started planning their overseas journey more than 12 months in advance was surprisingly small at just 6%.

PLANNING & BOOKING

On average, Australians used 1.6 different distribution channels to book their trip, with 66% booking at least some of their overseas holiday through a traditional ‘bricks-and-mortar’ travel agent or an online travel agent, and just 20% booking direct with a tour operator⁶.

3-6 mths42%

<3 mths25%

6-12 mths27%

1-2 yrs5%

Time planning commenced prior to departure

Other

Booking channels60%

50%

40%

0%

10%

20%

30%

AirlineDirect

Travel Agent(offline)

44%

35%31%

Travel Agent(online)

29%

HotelDirect

20%

TourOperator

Direct

>2 yrs 1%

10

PLANNING & BOOKING

Travellers aged 61 years and older were more likely to book through off-line travel agents rather than their online rivals.

For all other age categories, the split between online and off-line retailers was fairly even, with Australians aged 36-50 years - a group that in 2018 operated with smaller holiday budgets, took shorter holidays and favoured medium-haul destinations - the most likely to favour OTAs.

Booking trends: travel agents60%

50%

40%

0%

10%

20%

30%

% w

ho b

ooke

d

18-35 71 +61-7051-6036-50

Age

36%

27% 28%

46%

55%

32%12%

32%30%35%

Online Offline

11

1: Results quoted in the 2018 report are based on a combination of ABS visitor research, and consumer surveys involving more than 3,000 Australians who took an overseas holiday in 2018. Findings were also cross-referenced with data from Tourism Research Australia.2: Based on Australia’s population of 25.2 million (per ABS) as at 31 December, 2018.

3: Tourism Research Australia also tracks Australian outbound holiday traffic, however, its figures do not include leisure journeys taken by Australians aged 15 years or younger, resulting in a lower total figure.4: The ranking reflects holiday traffic only and not the total number of short-term departures to each destination.

5: Rail and coach/bus categories incorporate a variety of travel options, including point-to-point journeys, multi-day excursions, sightseeing day tours and extended coach journeys. Future research will explore these options in more depth.6: Tour operators include any travel intermediary that creates packaged tour products.

When asked to name the regions they were considering for their next holiday, Oceania was a clear favourite, followed by South East Asia, Europe and North East Asia.

With the exception of South East Asia, these preferences far exceeded the proportion of visitors these regions attracted in 2018.

While the results may reflect travellers’ aspirations, rather than firm plans, they may also suggest that Oceania, Europe and North Asia were poised for growth in 2019.

Only two regions recorded preferences below their 2018 results: South East Asia and Southern & Central Asia.

This may signpost a drift in Asia-bound holiday traffic from established SEA holiday spots towards emerging destinations in North East Asia, including China, Japan and South Korea.

WHERE NEXT?

THE COUNCIL OF AUSTRALIAN TOUR OPERATORS

Where would you like to go next?40%

0%

10%

20%

30%

Oceania SE Asia Southern& Eastern

Europe

NW EuropeSouthern & Central Asia

NE Asia

38%

30%

21%

6%

23%

15%16%

35%

6%9% 9% 7%

Preference

Trav

elle

rs S

urve

yed

Nth Africa & Middle East

5% 2%

Americas

18%

14%

2018

The Council of Australian Tour Operators (CATO) is the representative body for Australian-based ATAS accredited tour operators and wholesalers. CATO members work with hoteliers, airlines and other suppliers to assemble and sell through travel agents

and direct to Australian consumers – domestic and international travel packages. CATO’s activities on behalf of its members cover a wide range of services, including advocacy, research, events, marketing, networking and industry awards.

12

LOCATION GUIDE

Brunei

Cambodia

Indonesia

Laos

Malaysia

Myanmar

Phillippines

Singapore

Thailand

Timor-Leste

Vietnam

China

Hong Kong

Japan

Korea, North

Korea, South

Macau

Mongolia

Taiwan

Bangladesh

Bhutan

India

Maldives

Nepal

Pakistan

Sri Lanka

Afghanistan

Armenia

Azerbaijan

Georgia

Kazakhstan

Kyrgyzstan

Tajikistan

Turkmenistan

Uzbkistan

ASIA

SOU

TH E

AST

ASIA

NO

RTH

EAS

T AS

IASO

UTH

ERN

& C

ENTR

AL A

SIA

USA

Canada

Bermuda

Argentina

Bolivia

Brazil

Chile

Columbia

Ecuador

Falklands Is.

French Guiana

Guyana

Paraguay

Peru

Suriname

Uruguay

Venezuela

Bahamas

Belize

Caribbean Is

Cayman Is.

Costa Rica

Cuba

El Salvador

Guatemala

Honduras

Mexico

Nicaragua

Panama

Virgin Is.

AMER

ICAS

CEN

TRAL

NTH

SOU

TH

England

Scotland

Wales

Ireland

Channel Is.

Isle of Man

Austria

Belgium

France

Germany

Liechtenstein

Luxembourg

Monaco

Netherlands

Switzerland

Denmark

Finland

Greenland

Iceland

Norway

Sweden

Gilbraltar

Italy

Malta

Portugal

Spain

Albania

Bosnia

Bulgaria

Croatia

Cyprus

Greece

Moldova

Romania

Slovenia

Montenegro

Serbia

Kosovo

Belarus

Czech Republic

Estonia

Hungary

Latvia

Lithuania

Poland

Russia

Slovakja

Ukraine

EURO

PE

NO

RTH

NO

RTH

WES

TW

ESTE

RNSO

UTH

Bahrain

Iran

Iraq

Israel

Jordan

Kuwait

Lebanon

Oman

Qatar

Saudi Arabia

Syria

Turkey

Unit. Arab Em.

Yemen

MID

DLE

EAS

T

MID

DLE

EAS

T

Sth Pacific Is.

New Zealand

AntarcticaOCE

ANIA

OCE

ANIA

Algeria

Egypt

Libya

Morocco

Sudan

Tunisia

West. Sahara

Sth. Sudan

Benin

Burkina Faso

Cameroon

Cabo Verde

Chad

Cote d’Ivoire

Equator. Guinea

Gabon

Gambia

Ghana

Guinea

Guinea-Bissau

Liberia

Mali

Mauritiania

Niger

Nigeria

Senegal

Sierra Leone

Togo

Angola

Botswana

Burundi

Comoros

Djibouti

Eritrea

Ethiopia

Kenya

Lesotho

Madagascar

Malawi

Mauritius

Mayotte

Mozambique

Nambia

Reunion

Rwanda

St Helena

Seychelles

AFRI

CA

SOU

TH &

EAS

TN

ORT

HCE

NTR

AL &

WES

T

SOU

TH E

AST

EAST

Somalia

South Africa

Swaziland

Tanzania

Uganda

Zambia

Zimbabwe

AFRI

CA

SOU

TH &

EAS

T

13

FOR FURTHER INFORMATIONCouncil of Australian Tour Operators Inc.

Suite 3, Level 31, 31 Market Street, Sydney NSW 2000 Web: www.cato.travel Email: admin@cato.travel

WITH THANKS TO OUR PARTNERS COMPILING THIS REPORT: