In light of the demise of the 178 year old operator, Thomas Cook, there has been much chaos and uncertainty surrounding the package holiday market.
However, in reality, the global market value of the package holiday market is booming at US$510bn in 2019, forecast to reach US$632bn by 2023, according to GlobalData, a leading data and analytics company.
The company’s latest report, ‘Case study: Future of the package holiday industry’, found that the static package (combination of services put together by a travel intermediary) currently cartwheels over the market value of the dynamic package holiday. However, the dynamic package is gaining considerable traction with a growth rate near double that of static holidays for 2019-2023 (CAGR static: 5%; dynamic: 8.7%)
Johanna Bonhill-Smith, Travel and Tourism Analyst at GlobalData, says: “Recorded growth of the dynamic package holiday reflects changing traveler trends as tourists become more independent within the booking process. Opting to construct their own ideal vacation, travelers now hold more power than ever before.
“Numerous source markets worldwide, however, still heavily depend on a static operator, driven by affordability, security and convenience of booking. The UK, Germany and China for example are three of the most advanced destinations in the world in terms of technology, society and economy yet still heavily depend on the package operator.”
Despite continuous growth, tour operators face continuous challenges ahead and thus it will not be ‘plain sailing’ from here for the industry.
Operators in both the UK and Europe are still awaiting verdict and are uncertain on the conditions of Brexit. Wider industry issues look to waste management and hyper-competition within an already competitive marketplace.
Bonhill-Smith concludes: “Looking to the future, operators that keep to the traditional model of the typical ‘all-inclusive’ package operator are likely to be at greater risk. Consistent adaptation to evolving market demand is crucial to remain successful within the current travel industry.”