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July 5, 2022

Asia’s growing middle class is an attractive source market

The rise of Asia's middle class has resulted in an increase in disposable income.

By Globaldata Travel and Tourism

Asia has been one of the fastest-growing tourism source markets in the world, representing 30.2% of global outbound tourists in 2019 (the last year unimpacted by the pandemic). This percentage is expected to rise to 30.7% of global outbound tourists in 2025. Asia’s middle class is leading this growth, and destinations need to look at how they can attract this lucrative market.

The rise of Asia’s middle class has resulted in an increase in disposable income. Higher living standards are enjoyed by this market and now hundreds of millions of Asians have the means to travel overseas.

Wealth distribution and access to information has been key

The expanding middle class in Asia has positively impacted outbound tourist expenditure for many nations. China, Singapore, Japan, and India are leaders in terms of outbound tourist expenditure. The graph above shows the average international tourism spend per day from these countries. China is one of the most lucrative markets in this region. However, stringent lockdown measures are stopping many from travelling internationally in 2022, with many destinations waiting eagerly for Chinese travellers to return in their hordes.

Additionally, the increase in travel intermediaries within these nations has enhanced the availability of information regarding travelling internationally, and has played an important role in the rising number of outbound travellers as a result. As prospective travellers acquire more knowledge and information about destinations they find attractive due to greater access to information, demand for outbound travel grows. Travel intermediaries have utilised various media channels and advertising platforms to generate demand and increase access to information for the Asian market. For instance, Booking.com and Expedia use social media platforms to promote their offers and discounts, which increases overall choice.

Focusing on this market will accelerate post-Covid recovery

Destination marketing organisations across the globe must focus on the Asian middle class if they are not already. This will no doubt accelerate recovery and help to diversify their visitor base. According to GlobalData’s Q3 2021 Consumer Survey, 71% respondents from China and 54% of respondents from India said they typically take sun and beach holidays. This suggests that destination management organisations (DMOs) should heavily market their sun and beach offerings to Asian travellers within marketing campaigns.

Growing demand for international trips from this market has led to the formation of many low-cost airlines, as well as the worldwide direct route development of several premium carriers like British Airways and United airlines. The expanding GDP of several Asian nations, as well as the execution of various financial policies, will help to build economic stability and improve wealth distribution, which will continue to grow the region’s middle class.

Covid-19 has heavily impacted the global tourism industry in such a way that many small to medium-sized companies had to either shut up shop or lay off employees. To get these companies operating at maximum capacity once again, DMOs need to consider increasing their focus on targeting Asian countries and their middle-class communities.

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