Leisure Group Travel Grows & Goes Online
In the latter half of 2006, Sherman, Conn.-based PhoCusWright, Inc., a market research firm specializing in electronic commerce trends in the travel and tourism industries, conducted extensive research on meetings and groups within the United States to better understand the current state and, more importantly, where this business segment is headed.
Specifically, its research goals were to size the overall groups and meetings market, to determine what portion would be driven by electronic commerce and to establish an initial baseline for future tracking and monitoring. What it found was that the market opportunity is big – really big!
Small Leisure Groups at the Sweet Spot
The total meetings and group market size was expected to have reached $164.1 billion by the end of 2006, and with forecasted growth, it is projected to reach $175 billion by 2008. Of particular note is the small, social/leisure gatherings market segment, which represents one of the most significant market opportunities within the groups and meetings arena. It is the fastest growing
market segment, both on- and offline, and will continue to grow at impressive rates for the foreseeable future. This segment for travel-related components (i.e., air, hotel, ground transportation and cruise) was valued at $47.2 billion in 2006 and is expected to reach $51.3 billion by 2008. From an online perspective, this equated to $11.2 billion in 2006. By 2008, forecasts suggest that 42% of all small leisure group business will be booked online to the tune of $14.5 billion.
Both online and offline, air and hotel will contribute the lion’s share of the activity in this segment. These are among the important findings detailed in PhoCusWright’s report entitled Groups and Meetings: Market Opportunity Redefined.
Because of the overall size of the groups and meetings marketplace in general and the small leisure group segment in particular, the fragmentation of the marketplace, the many untapped opportunities, and the online potential, many are finding this space remarkably attractive and worthy of pursuit.
Consequently, they are working diligently to capture their fair share of this growth market. Although developments in this market arena tend to be more evolutionary than radical, no one can afford to sit on the sidelines taking
a wait-and-see approach. As traditional suppliers, intermediaries, and new market entrants vie for market share, there will be great shifts in competitive dynamics and the industry landscape as a whole, making this an exciting space to watch but a difficult one to navigate.
By Daniel J. Connolly
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Courtesy of leisuregroutravel.com
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