Domestic Tourism Market

Domestic Tourism Market Size (2023-2028):

The Global Domestic Tourism Market was worth US$ 1.55 billion in 2022, and it is estimated to reach a valuation of US$ 3.25 billion by the end of 2028, expanding at an annual growth rate of (CAGR) of 13.39% during the forecast period.

Market Overview:

Domestic Tourism is referred to tourism that involves residents of one country traveling within their own country and does not involve crossing international borders at entry points. It means visits within their own country by visitors who are residents of their own country. In Domestic tourism, people like to travel and explore their nearby places. Domestic tourism involves local, regional, or interstate travel. The population can book their travel through Online Booking Agencies (OTA) or through direct booking. There are different types of tour and travel packages available in the market, people have the option to choose according to their budget and willingness to travel. The government of several nations worldwide are taking important initiatives and increasing their spending in order to raise tourism and employment of the population which further boost the growth of domestic tourism in the market during the period between 2023 and 2028.

Market Drivers:

The driving force of the Domestic Tourism Market is the increasing disposable income of the population particularly of the middle class.

The middle-class population in several nations is increasing along with increasing income and therefore drives the growth of the domestic tourism market. The rise in the inclination of the population toward unique and exotic holiday experiences. The people are showing their interest in visiting unique places within their own country's boundaries and want to have unique experiences by visiting exotic places.

The increased exposure of people to different forms of social media has enhanced their knowledge about various trends and various tourist places. Social media is increasingly working as a pseudo-travel agent. Customers are increasingly opting for those places where they know people have stayed or previously traveled there. In addition to it, they refer to reviews and insights detailed on various social networking sites. Therefore, the use of social media for promotion is driving the growth of the tourism market.

The growing trend of rural and nature tourism is increasing after the stringent lockdown of pandemics. The people are likely to prefer rural and nature tourism. Rural tourism includes agricultural tourism, gastronomic tourism, and health tourism which are prominent. The surging demand for rural tourism is going to propel the growth of the domestic tourism market.

The increasing trend and ease of online booking are fueling the growth of the market. Additionally, mobile applications, big data analytics, and artificial intelligence is evolving together to propel the domestic tourism industry.

Market Restraints:

An increase in tourism and crime rate, political uncertainty, and natural calamities along with inadequate support infrastructure challenging market expansion are the factors that restrict the growth of the domestic tourism market.

DOMESTIC TOURISM MARKET REPORT COVERAGE:

Market Segmentation:

Domestic Tourism Market - By Location:

• Local or Regional Travel
• Interstate Travel

Based on Location, the global domestic Tourism Market is segmented into Local or Regional Travel and Interstate Travel. The Interstate travel segment is dominating the market. Interstate traveling involves tours of places that are limited to the country's border. Interstate travel has gained much popularity because people like to visit different places rather than visiting the same place, thus demand to tour other states within the country Furthermore, due to pandemic restricts and ban on international tourism, people are getting a chance to explore the near places or famous destination in their country itself. Thus, all these factors further drive the growth of the domestic tourism market.

Domestic Tourism Market - By Mode of Booking:

• OTA Platform
• Direct Booking

Based on the Mode of Booking, the global domestic Tourism Market is segmented into the OTA Platform and Direct Booking. The OTA segment is dominating and will dominate the domestic tourism market during the forecast period as the OTA platform provides access to huge trips and travel packages. OTA platform offers quick and convenient flight and hotel bookings, rising customers’ trust in online payment, and allows for comparing various available travel options that encourage customers to book their trips through the OTA platform. Additionally, OTAs provide intelligence and smart tools in order to locate travelers, protect & process reservations, communicate with guests, and manage reviews and therefore enhancing the customer’s personal experience.

Domestic Tourism Market - By Tour Type:

• Conference/Meetings
• Weekend Gateways
• Adventure Tours
• Organized Tours
• Holiday Trips
• Others

Based on Tour type, the global domestic Tourism Market is segmented into Conferences/Meetings, Weekend Gateways, Adventure Tours, Organized Tours, Holiday Trips, and Others. The weekend gateways segment is dominating the marketing as it does not require detailed planning or large budgets. Also, it can be organized for large groups.

Domestic Tourism Market - By Age Group:

• Below 30 Years
• 30-41 Years 42-49 Years
• 50 Years and Above

Based on the Age Group, the global domestic Tourism Market is segmented into Below 30 Years, 30-41 Years, 42-49 Years, and 50 Years and Above. The Age group below 30 years and 30-41 years collectively hold around 68.2% of the market share in 2020. Travels between the age group 30-41 years are moderate spending groups. However, 95% of this age group are frequent travelers and have travel plans once a year. This age group denotes the largest generation and has a large number of trips annually and is likely to spend on unique experiences. On the other, for those below 30 years of age group, travelers are budget conscious and seek immersive travel experiences. They are highly influenced or inspired to travel due to social media. Therefore, below 30 years of age group people is going to boost the domestic tourism market growth in the forecast period.

Market Regional Analysis:

The Global Domestic Tourism Market has been categorized into four regions:

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East & Africa

North America is expected to have a significant share of the domestic tourism market during the forecast period. The United States of this region is the top country for domestic travel and tourism spending in the world. In 2019, domestic travel and tourism spending in the United States of America was USD$899.3 billion which is 21.14% of the global domestic travel and tourism spending. The high disposable income and increasing stress levels during the pandemic are going to boost the domestic tourism market in this region.

The emergence of the middle class is growing in this region and now Asia-Pacific has citizens with increasing disposable income which is going to increase domestic tourism in this region. In

Asia-Pacific region, China is the largest contributor to GDP through travel and tourism and it is the third most visited country in the world. Asia-Pacific also scores above the global average for ground and port infrastructure as well as the pillars of the Enabling Environment subindex. Japan has a large economy and provides an expansive domestic market for tourism. Also, the nature and the diverse culture in the APAC region are driving the growth of domestic tourism in this region.

In Europe, domestic tourism is a significant part of the European Travel and Tourism industry along with international tourism. Domestic spending by far dominated the distribution of travel and tourism spending in Europe in 2020 and nearly three-quarters of all travel spending is coming from domestic tourism alone. In this region, some countries spend more on domestic travel than others. Germany and France were the dominating European countries that have the highest expenditure on domestic trips and each spent around 50 billion euros. The spending power of the countries in domestic travel is expected to drive the growth of the domestic tourism market.

Leading Company:

Booking Holding Inc had the largest share of the world’s Domestic Tourism in terms of sales revenue in 2020.

Covid-19 Impact on Global Domestic Tourism Market: 

The COVID-19 outbreak has had a significant impact on Global Domestic Tourism due to strict lockdowns, travel restrictions, and social distancing imposed by governing bodies of several nations. The lockdown across various countries has hampered international as well as domestic travel. Several countries itself has not opened their border to international tourism. For instance, there was an 83% drop in internal tourists in 2020. In the initial phase of COVID, people itself were not willing to go outside, but with the long-term effects of coronavirus and a large number of vaccinated population; now population like to choose to visit and explore their regional or interstate tourist places in order to release worst memories of this outbreak. Owing to this region, the demand for domestic tourism will increase which will further boost the growth of the Domestic Tourism Market in the projected period between 2022 and 2027

Market Key Players:

Some of the leading companies operating in the Global Domestic Tourism Market are 

1. Abercrombie & Kent USA LLC
2. Butterfield & Robinson
3. Cox & Kings Ltd.
4. Kensington Tours
5. Micato Safari
6. Scott Dunn Ltd.
7. Tauck, Inc.
8. Thomas Cook India Ltd.
9. Travcoa Corporation
10. TUI Group

Market Recent Developments:

• In October 2021, Abercrombie & Kent introduced “Wings Over Mexico” which is the newest addition to A&K’s lineup. “Wings Over Mexico” is a journey that showcases the rich cultural diversity and scenery found south of the border beyond the beaches and all-inclusive resorts.
• In Feb 2021, Expedia launched the “Emergency Accommodation Portal” in order to assist in providing real-time hotel information
• In July 2021, Wheels Up (is leader in private aviation) and Abercrombie & Kent (the world’s leading luxury travel company) announced a strategic partnership to offer Wheels Up Members bespoke travel experiences by utilizing the Wheels Up feet in North America and private small group journeys in international destinations.