2014 Adventure Travel Trade Association Industry Snapshot

Transcription

1

2 2014 Adventure Travel Trade Association Industry Snapshot Each year the Adventure Travel Trade Association (ATTA) invites adventure businesses to anonymously share information about their companies, destinations and activities of increasing and decreasing interest, observed traveler trends and future projections. In 2014, special interest topics such as risk and safety management and local spending are included. Providing the opportunity to view the adventure industry through the eyes of the businesses working in the sector, the ATTA Industry Snapshots serve as a barometer of the adventure tourism community s performance, health and outlook. The 2014 Industry Snapshot asked respondents to share information about the 2013 business year. The survey was conducted using QuestionPro Online Survey Software between February 3 and February 23, The survey was completed in full by 306 adventure inbound and outbound adventure travel tour operators, with 651 respondents completing the questionnaire in part. Since 2006, the ATTA has surveyed its growing global tour operator membership base and amassed more than eight years of data suitable for year-to-year comparisons. This information is available free to ATTA Members on The HUB s Research Center Survey Result Highlights The 2014 survey collected responses from companies responses were received from North America than in 2013, making North America the Industry Snapshot s largest segment of respondents (for the sake of this study, North America includes Mexico, Canada and the United States). Financials On average, companies reported gross revenue of $3,722,855 US Dollars in 2013, an increase of twenty- percent, down from seventeen percent in The revenue outlook for 2014 is positive, with seventyseven percent of companies estimating an increase in revenues. The average expected change in revenue is twenty-four percent growth. Seventy-one percent

3 twenty-three percent, primarily driven by expected new customers. Operations their Operations and Sales teams in 2013, indicating real growth in the sector. Booking customers the option of booking online. Thirty-nine percent of that group, however, note that their online booking option is through . For those companies who do have a reservations system, forty-six percent say they are using a custom system built in-house. Safety and Licensing As the adventure travel industry continues to expand, the importance of safety management procedures increases. The 2014 Industry Snapshot asked respondents to share basic information about licensing and risk management practices. Sixty-three percent of companies report licensing requirements from a national, state or local industry regulating body. Seventy-six percent report that they have a documented risk management plan in place. Marketing Adventure travel tour operators on average spend only three percent of gross revenue on marketing, while top their marketing budgets at eight percent of revenue. bookings, indicating that operators continue to seek marketing spends. Product and Traveler Trends Guest and Trip Details Globally the average age of guests reported is 48 years old. There was a slight shift to more women travelers doing 5,485 guests per year. Trips average nine days in duration and cost $477 per day, excluding airfare. The average guide-to-guest ratio reported is 1:8. Adventure Traveler Source Markets Regardless of where an adventure company is headquartered, the leading source markets for adventure

4 The exception to this comes from companies Europe, second from their home region of Africa, and third from North America. Destinations Globally the countries most frequently booked in order of frequency are: the United States, followed by South Africa, Tanzania, Italy, Peru, and Costa Rica. Regions receiving the most increasing interest from travelers in 2013 over 2012 were destinations in South America, Southern Africa and Eastern Europe. It is noted that destinations in Northern Africa, Australasia, the more interest in 2013 than in Itineraries and Activities Custom itineraries, soft adventures and family or multigenerational trips topped the list for itineraries in growing demand by adventure travelers. Adventure tour operators noted that bicycling, trekking, and cultural experiences were the most frequently requested activities by travelers. Adventure tour operators estimate that on average sixtysix percent of their per guest trip cost is spent with local businesses and remains in the destination. This is the same percentage as was reported in Conclusion Overall the industry data shows a healthy and burgeoning market across key metrics the adventure travel industry is on the rise for the forseeable future. The data indicates, however, there is ample room for rates. Just as the adventure industry is expanding, so too is the adventure on the rise in places like Africa and Latin America as well as widely accessible activities such as cultural experiences, bicycling and trekking, customer interest may only be slightly shifting year to year, but over time, a pattern is emerging which opens the playing scope of industry players and travelers.

5 Organization Headquarters Middle East 1% Central America / Caribbean 2% North America 46% Pacific 3% Asia 5% Africa 8% South America 13% Europe 21%

6 Tour Operation Type Outbound (buyer) 27% Outbound and Inbound 25% Inbound (supplier) 48%

7 Customers Per Year HEADQUARTERS CUSTOMERS PER YEAR COMPANY SIZE IN 2013 BY REVENUE CUSTOMERS PER YEAR Africa 4,522 Asia 12,578 Central America / Caribbean * 903 Europe 9,544 Middle East * 3,700 $0-250k 1,170 $250k-1m 4,967 $1m-5m 4,973 Greater than $5m 11,660 North America 3,734 Pacific 8,094 South America 3,055 5,485 AVERAGE CUSTOMERS PER YEAR * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

8 Trip Length HEADQUARTERS LENGTH IN DAYS COMPANY SIZE IN 2013 BY REVENUE LENGTH IN DAYS Africa 9.3 Asia 12.1 Europe 9.2 North America 8.3 Pacific 10.5 South America 7.5 $0-250k 8.5 $250k-1m 8.6 $1m-5m 7.6 Greater than $5m AVERAGE TRIP LENGTH IN DAYS * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

9 Trip Price Per Day in US Dollars Including lodging, excluding airfares HEADQUARTERS PER DAY, 2013 Africa $352 Asia $478 Central America / Caribbean * $155 Europe $343 Middle East * $148 North America $630 $477 AVERAGE GLOBAL TRIP PRICE PER DAY Pacific * $534 South America $302 * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

10 Full Time Employees Non-Staff Subcontractors $0-250k 10.2 $0-250k 8.9 Company Size by 2013 Revenue $250k-1m $1m-5m Company Size by 2013 Revenue $250k-1m $1m-5m Greater than $5m 44.0 Greater than $5m 50.3

11 In what business area did you add the most staff in 2013? Operations 26% Accounting 2% Other 2% Marketing 8% Sales 21% Office Administration 9% Guides 13% No additions in %

12 What percentage of your organization's annual revenue is spent on payroll (excluding contractors)? 28.2% OF REVENUE SPENT ON PAYROLL

13 Guide to Guest Ratio HEADQUARTERS RATIO Africa 1:9 Asia 1:13 Central America / Caribbean * 1:7 Europe 1:10 Middle East * 1:6 1:8 GLOBAL AVERAGE North America 1:7 Pacific * 1:7 South America 1:6 * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

14 Estimated percentage of trip cost per guest that remains in the local region 65.6% OF TRIP COST REMAINING IN THE REGION

15 Average estimated guest expenditure on local handicrafts or souvenirs $186 US DOLLARS SPENT PER GUEST ATTA asked tour operators to estimate how much an average guest spends on local handicrafts or souvenirs.

16 Europe 41.6% North America 19.4% Asia 5.4% South America 2.6% Africa 28.7% Oceania 2.3% Source of Bookings for companies headquartered in AFRICA 2014 Adventure Travel Trade Association.

17 Europe 41.4% North America 21.3% Asia 20.3% South America 3.7% Africa 3.0% Oceania 10.3% Source of Bookings for companies headquartered in ASIA 2014 Adventure Travel Trade Association.

18 Europe 55.6% North America 27.1% Asia 5.8% South America 4.3% Africa 3.2% Oceania 4.0% Source of Bookings for companies headquartered in EUROPE 2014 Adventure Travel Trade Association.

19 Europe 16.5% North America 48.8% Asia 7.9% South America 14.6% Africa 9.7% Oceania 2.4% Source of Bookings for companies headquartered in NORTH AMERICA 2014 Adventure Travel Trade Association.

20 Europe 28.8% North America 38.4% Asia 3.3% South America 21.0% Africa 2.4% Oceania 6.1% Source of Bookings for companies headquartered in SOUTH AMERICA 2014 Adventure Travel Trade Association.

21 Ability for Customers to Book Online By Company Size in 2013 $0-250k 43% 57% Yes 55% $250k-1m 48% 52% No 45% $1m-5m 42% 58% Greater than $5m 38% 63% Yes No

22 Companies which provide customers with the ability to book online were asked the following questions. How Can Customers Book Online Origin of Reservations System Custom, built in-house 46% Via 39% Combination of Off the Shelf and Custom 23% Third Party Service Provider 22% Via Web 61% Off the Shelf 8% Other 2% Percentage of Respondents

23 Asked to companies with the ability to book online Bookings Completed Online and Offline By Region Africa * Asia 38% 42% 58% 63% Central America / Caribbean * 26% 74% Online 56% Europe Middle East * 20% 41% 59% 80% Offline 44% North America Pacific * 38% 44% 56% 62% South America 47% 53% Online Offline * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

24 2013 GROSS REVENUE $3,722,855 USD * Average reported gross revenue for adventure travel companies + OVER 20.9% 2012

25 2013 MARGIN 15.3% =( ) EBITDA (EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION) GROSS REVENUE 17.5% 2012 MARGIN

26 Revenue Outlook for 2014 Flat 16% +24.1% Up 77% AVERAGE ESTIMATED INCREASE IN REVENUE Down 7%

27 Net Profit Outlook for 2014 Flat 22% Up 71% +23.2% AVERAGE ESTIMATED INCREASE IN NET PROFIT Down 7%

28 Primary Factor Influencing Net Profit Projections New customers 107 New products added while controlling costs 41 Access to new markets New business lines added Currency exchange Other Decreased overhead Increased overhead Less new customers More repeat business Less or flat product offerings while controlling costs Lower and flat pricing structure 8 7 Less repeat business Oil/gas prices 2 2 Respondent Count

29 Customer Demographics Groups 25% Solos 18% Female 53% Male 47% 28 and under 11% 70+ 4% % Families 17% Couples 40% % % %

30 Average Age of Clients HEADQUARTERS AVERAGE AGE Africa 45 Asia 47 Central America / Caribbean * 41 Europe 47 North America GLOBAL AVERAGE CLIENT AGE Pacific * 50 South America 46

31 Regions of Changing Customer Interest for 2014! Higher scores correspond with increased customer interest in region Index Key 100% Increase in Interest = 1,000 No Change = % Decrease in Interest = 0 Regions charting the greatest movement since 2013 have been highlighted. Not Applicable responses were not tabulated in this chart South America Southern Africa Eastern Europe Western Europe North America Scandinavia Australasia Central America South East Asia India/South Asia East Africa Central Asia Antarctic Arctic Mediterranean China/North East Asia Russia Northern Africa Caribbean West Africa Middle East

32 Top Countries Clients Are Booking By Company Headquarters HEADQUARTERS #1 #2 #3 #4 #5 #6 Europe United Kingdom Croatia South Africa Tanzania France Norway North America United States Tanzania Italy Peru South Africa Costa Rica All Regions United States South Africa Tanzania Italy Peru Costa Rica

33 Itineraries of Changing Customer Interest Custom itineraries ! Soft adventures Higher scores correspond with increased customer interest in activity Index Key 100% Increase in Interest = 1,000 No Change = % Decrease in Interest = 0 Activities charting the greatest movement since 2013 have been highlighted. Not Applicable responses were not tabulated in this chart Family or multi-generational Cultural-based adventures Long-haul/overseas travel Self-guided Shorter duration Domestic and/or regional travel Green Travel Options Hard adventures 567 Volunteering during the trip

34 Top 2014 Activities Word Cloud 2014 Adventure Travel Trade Association.

35 Marketing Budgets (US Dollars) 2014 AVERAGE 2013 AVERAGE CHANGE OVER 2013 BUDGET AS A PERCENT OF 2013 REVENUE TOP PERFORMING COMPANIES* PERCENTAGE OF 2013 REVENUE $120,594 $105, % 3.2% 7.7% * Top performing is defined as a company with a 2013 net profit margin that is higher than average.

36 2014 Marketing Budget Breakdown PERCENTAGE OF MARKETING BUDGET PERCENTAGE OF 2013 GROSS REVENUE AVERAGE DOLLAR AMOUNT Content creation and social media outreach (photos, videos, social sharing) 19.2% 0.6% $23,134 Trade events 13.4% 0.4% $16,127 Search engine optimization 11.5% 0.4% $13,860 Online advertising and sponsored content 10.8% 0.3% $13,004 Print advertising 9.4% 0.3% $11,332 campaigns 9.3% 0.3% $11,239 Public relations 8.2% 0.3% $9,941 Other 6.2% 0.2% $7,521 Consumer events 5.6% 0.2% $6,725 Direct mail 5.3% 0.2% $6,400 Smartphones and mobile apps 1.1% 0.0% $1,310

37 Effectiveness of Strategy to Drive Customer Bookings Not Effective Very Effective 4 Unpaid SEO (website optimization) Increasing commitment to customized itineraries More/better customer relationship management (CRM) tools Increased personal approach with clientele Publishing new media content Publishing client-generated content Increasing Travel Agent / Buyer Relationships Increasing product exposure and booking capabilities Increasing public/media relations support Social Media Outreach Altering programs (e.g., reducing size and cost of trips offered) Paid SEO Advertising (e.g., Adwords) Increasing sales staff Partnering with travel bloggers for content and outreach Special events (e.g., cocktail events, slideshow events) Smartphones & mobile apps (e.g., iphone, Droid) Other Print media advertising 2.1

38 Does your government require guides to hold any state, national and/or industry licenses? HEADQUARTERS YES Yes 63% Africa 81% Asia * 92% No 37% Central America / Caribbean * 100% Europe 57% North America 54% Pacific * 60% South America 82% * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

39 Does your company have a documented safety and risk management plan? HEADQUARTERS YES Africa 75% No 24% Yes 76% Asia * 58% Europe 78% North America 77% Pacific * 80% South America 79% * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

40 Companies reporting a documented risk management plan were asked: Is your safety and risk management plan verified or assessed by a third party? HEADQUARTERS YES Yes 57% Africa * 67% Asia * 71% Europe 46% No 43% North America 54% Pacific * 88% South America 73% * Results marked with an asterisk are inconclusive due to a small sample size equal to or less than 15 respondents.

41 Y ION P O UT C T B I F R A IST R D D R O F T O N