Emerging Markets are A Key Economic Force
The emerging markets are an economic force to reckon with.
Emerging and developing markets on a whole, account for 47.7% of world GDP at
purchasing power parity. China is ranked as the 2nd largest world economy
after the USA. India, Russia and Brazil rank 4th, 6th, and 8th
respectively.
Emerging markets have significant growth potential for travel and
tourism. China for instance, has a population size of 1.3 billion
citizens. However, only 4% of the total population travelled abroad in
2013. Similarly, a mere 1% of the Indian population travelled abroad in
2013. Both China and India are growing by an average of 10-12% per
year. On the contrary, the traditional markets are primarily
saturated. Germany for instance, has a travel base of almost 80% of its
population and has stagnant growth prospects. China is now the
number 1 travel market in the world ahead of USA, Germany and the UK.
Who are the Emerging Market Travellers?
With international travellers projected to almost double by 2020 to
approximately 1.6 billion, the most significant increases are expected to take
place in markets like China, India, Brazil and Russia. These markets are often
referred to as “emerging markets”.
Travellers from the emerging markets are wealthy
But who are these new travellers? Firstly, they are
wealthy. In Spite of the recession in 2008/2009 the number of
millionaires in India jumped by 20.8% (the highest in the world). China had the
fourth richest millionaire in the world in 2013 and added 5% more millionaires
than the average for the USA, Japan and Germany, according to Merrill Lynch’s World
Wealth Report. The middle class in emerging markets is also growing
apace.
They are young, hip and happening too
Emerging market travellers are also comparatively younger than the
top traditional travel markets. The population of South Africa and India
respectively, has an average age of 24.7 and 25.1 years. Brazil’s
population base is slightly older with an average age of 29 years, followed by
the UAE (30.1 years) and China (34.5 years). The populations of the
traditional travel markets of Japan, Germany and the UK each has an average age
of 45, 44 and 39 years respectively.
These new travellers are also educated
Travellers from the emerging markets are also very educated. India
has the 2nd highest number of individuals with tertiary level education (124.4
million). China captured the 3rd place with just over 100 million.
Russia is in 4th place with 91 million.
They are Internet savvy
They are also very Internet savvy. The use of the Internet to
research, plan and book travel is quite a common occurrence for emerging
markets. The sheer number of online users is absolutely astounding. The
Internet user population from the emerging markets, make up approximately 40%
of the 2.4 billion Internet users worldwide, according to Internet World Stats
2014. China leads with 538 million, followed by India (137 million),
Brazil (88.5 million) and Russia (68 million).
They seek status from travel abroad
Many citizens of emerging markets, who are of means, enjoy the
status that international travel brings and are quick to boast about their
trips to their colleagues. Culturally, there is social currency in
international travel and this is a significant driver for outbound travel.
If you liked this post, then perhaps these would be of interest to you as well:
- Diagonal Integration
- The Paradigm Shift in Travel and Tourism
- Fifty Shades of Green
- Sustainability is Sexy
- Communities Count
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