MARKETSCAN BRAZIL 2017

MARKETSCAN BRAZIL 2017

MarketScan Brazil MarketScan Brazil 2017 Inside knowledge of the Brazilian travel market is essential in order to gain access to this market. In this MarketScan, you will find a brief overview of the travel market as well as an insight into relevant trends and developments. De MarketScan Brazil 2017 is a report of NBTC Holland Marketing (NBTC). NBTC is responsible for branding and marketing the Netherlands nationally and internationally. Using the 'Holland' brand, NBTC puts the country on the map as an attractive destination for holidays, business meetings and conventions. We carry out marketing activities in 13 markets, under the name of NBTC Netherlands Board of Tourism & Conventions. In cooperation with public and private partners, we attract visitors who spend money in Holland. We cultivate countries and regions that supply the most visitors to the Netherlands. Based on this philosophy, NBTC is active in Europe, North America, Asia and South America (Brazil). 2

Content Brazil in a nutshell population 4 Brazil in a nutshell economy 5 Brazilian travel market 6 Internet and travel 7 Incoming tourism to Holland 8 Image of the Netherlands 13 Trends and developments 14 Destination Holland: SWOT 15 Holland Marketing in Brazil 16 Contact 17 References 18 Page 3

Brazil in a nuttshell - population Brazil has a total population of approx. 206 million people (estimation September 2016), with the South-East region accounting for the highest number of habitants (42%) due to big cities Rio de Janeiro and Sao Paulo (7th largest metropolitan area in the world). Together with the other regions North (9%), North-East (28%), South (14%) and Central-West (8%). Brazil is the sixt most populated country in the world. Numbers show that around 86% of the total population lives in an urban area. The main language is Portuguese. 55% of the population are European ancestors (mostly Portugal, Italy, Germany and Eastern Europe). A diversity of cultures can be found in the country. Source: ibge.gov.br; The World Factbook (2017) Age 8% 9% 23% younger than 14 years 15-24 years 23% of the Brazilian people are aged 0-14, 60% are aged 15-54 and only 16% is aged as 54+. 25-54 years 44% 16% 55-64 years 65 years and older Source: The World Factbook (2017); 4

Brazil in a nuttshell - economy Development GDP (%) 1.8 0.5 0.2 2014 2015 2016 2017* 2018* The economic activity in Brazil is projected to recover gradually in 2017. The IMF forsee a growth of the GDP in 2017 of 0.2%. But ongoing weakness in domestic demand and an increase in political and policy uncertainty will be reflected in a more subdued pace of recovery, and hence in lower projected growth in 2018. In 2016 the unemployment rate was 12%. In terms of Gross Domestic Product, Brazil has the 8th biggest economy in the world. -3.8-3.6 * Forecast Source: IMF (April 2017); The World Factbook (2017) Exchange rate 1 - Real (BRL) 4,70 4,50 4,30 4,10 3,90 3,70 3,50 3,30 3,10 2,90 2,70 2,50 Jan '15 Apr '15 Jul '15 Oct '15 Jan '16 Apr '16 Jul '16 Oct '16 Jan '17 Apr '17 Jul '17 Source: www.currency-converter.net 5

Brazilian travel market Number of outbound trips (x million) Overnight outbound visitors 2010 2011 2012 2013 2014 6.5 7.8 8.5 8.7 8.8 Data of Brazilian outbound tourism is spare. According to the OECD there were in 2014 8.8 million Brazilians travelling abroad. Based on figures from the ETC the number of outbound travelers can be estimated at 8,2 million in 2016. In Brazil, the economic and political crisis has hit the travel industry heavily. Outbound travel crashed by 15% in the first eight months of 2016, according to World Travel Monitor figures. There was a 10% slump in trips to to Europe. The overall number of foreign holidays plummeted by 20%. Brazilians went on shorter international trips, reduced their spending. However, the worst could be over. There are hopes of a small turnaround in 2017 with a 3% rise in outbound trips, based on IPK s Travel Confidence Index, which might reflect an improving economic outlook for the country. Source: OECD (2017); World Travel Monitor (2017); ETC (2017) Top 5 destinations (2014) 1 USA 26% 2 Argentina 12% 3 Portugal 5% 4 Uruquay 5% 5 Spain 5% In 2016, companies associated with Braztoa (the Brazilian Tour Operators Association) reported a market share of domestic tourism of 81.4%, as compared with 78.5% in 2015, reflecting the crisis marked by substitution of destinations. The United States is the most popular destination followed by the South-American destination Argentina. Also the European destinations Portugal and Spain are represented in the top 5 which is presented on the right. Portugal is very popular because of the strong connection with Brazil; Brazil once was a colony of Portugal. ETC estimates Europe s market share at 35%. Source: OECD (2017); Braztoa Yearbook 2017 (2017); ETC (2017) 6

Internet and travel Internet penetration Norway Denmark Netherlands Sweden Japan UK Germany Belgium USA France Spain Russia Italy Brazil China India 35% 97% 96% 95% 93% 93% 92% 89% 88% 88% 88% 82% 73% 66% 66% 53% A growing number of Brazilians use internet (139 million). This equals approximately two third of the population in Brazil. Of the adult population of Brazil 62% use a smartphone. 58% of the Brazilians are active users of social media. The average daily use of social media via any device is no less than 3 hours and 43 minutes. Approximately 80% of Brazilians social media users indicate that they look for special offers via social media. Blogs, forums, and social networks have become important platforms for social media users in Brazil for sharing thoughts and opinions about travel destinations. Brazilians are tech savvy and rapid adopters of new technologies. Online bookings reached 31% of total travel in 2015, outpacing every country in Latin America except Chile (also 31%). Online penetration will continue to grow, following the patterns of more mature markets, and is expected to capture nearly half of all bookings in 2020. Source: Wearesocial & Hootesuite (2017); Phocuswright (2016); emarketer (2016) Top 5 social media platforms (% of internet gebruikers) 1 63% 2 62% 3 53% 4 42% Facebook and You Tube are the most popular social media platform, followed by Whatsapp, FB Messenger and Instagram. The number of social media users is still increasing. 5 40% Source: Wearesocial & Hootesuite (2017) 7

60 61 60 85 117 121 123 102 116 119 115 139 172 150 208 241 257 247 291 321 Incoming tourism to Holland Development inbound tourism (x 1,000) The number of Brazilian guests visiting the Netherlands decreased in 2016 with 23% because of the deep economic recession in Brazil The latest figures on inbound tourism to Holland and our forecasts van be found in Tourism in perspective via our website. 2007 2008 2009 2010 2011 2012* 2013 2014 2015 2016 * Change in research design guests nights Source: CBS (2017) Brazilian visits per quarter of a year 25% 21% Jan-Mar Apr-Jun Jul-Sep Oct-Dec Holland received the most Brazilian guests in the period April up to June. 25% 29% Source: CBS (2017) 8

Incoming tourism to Holland - Business trips Purpose of visit 25% 3% Leisure Of all Brazilian visits to Holland, 73% has a holiday motive. Trips with a business motive account for one quarter of all trips. Business 73% Other Source: NBTC Statistics Incoming Tourism (2014) More information of the business market on www.nbtc.nl 9

Incoming tourism to Holland Brazilian overnight guests 5 big cities 1 Amsterdam 84,000 2 Rotterdam 3,000 3 The Hague 2,000 4 Utrecht 1,000 80% of the total number of Brazilian visitors stayed in one of the five big cities in 2016 (90,000 guests). Most of them stayed in Amsterdam in 2016 (84,000 Brazilian guests). 5 Maastricht 0,000 Source: CBS (2017) Spending Brazilian visitors Per person per day 298 Per person per stay 1017 Brazilian guests spent 1017 per person per stay. This is far above the average of 719 for all incoming tourists in 2016. In total the Brazilian visitors spent 117 million in the Netherlands. The average stay of Brazilian in Holland is 5.0 nights. Source: NBTC Statistics Incoming Tourism (2014); CBS (2017) 10

Incoming tourism to Holland Top 5 activities in Holland 1 Visit a bar or café 80% 2 Walking 75% 3 Walk through a town / city 73% 4 Visit a musueum 71% 5 Visit the Red Light District in Amsterdam 70% Of all Brazilian visitors to Holland, 73% walks through a town/city and for 16% is this the most important activity during their stay. 71% visits a museum and for 15% is this the most important activity. Other popular activities are walking (75%), visiting a bar or café (80%), walking (75%) or visiting the Red Light District (70). However, these activities are seldom the most important activities during the visit. Of all visits by Brazilians to Holland with a leisure motive, 62% defines the type of holiday as a city trip, 14% as being a cultural holiday. Source: NBTC Statistics Incoming Tourism (2014) Intention to re-visit 12% 4% 2% 83% Certainly would Probably would Maybe Probably not Of all Brazilian visitors in the Netherlands, 83% said that they definitely have the intention to visit the country again in the future. Twelve percent stated to probably return for a visit. Four percent answered with maybe and only 2% said probably not. Source: NBTC Statistics Incoming Tourism (2014) 11

120 154 177 193 210 228 219 231 Incoming tourism to Holland Flight capacity Brazil-NL 370 478 532 606 615 653 656 683 The flight capacity in seats decreased in 2016. The number of seats was 219,000 in 2016, -4% compared to 2015. The number of departures was 656, which is an approximately the same as in 2015. In 2017 the flight capacity is expected to increase. 2010 2011 2012 2013 2014 2015 2016 2017* *Forecast Seats (x 1,000) Departures Source: RDC Apex (2017) The figures provide insight in the capacity of seats and flights, not in the occupation. Stopping flights are included in the numbers.. 12

Image of the Netherlands Image of the Netherlands lots of (window) shopping possibilities offers a lot to be active\sporty short breaks 100% 90% 80% hospitable country family-friendly offers a lot in terms of nature (reserves) high quality culinary range good price/quality ratio in hospitality mainly tulips, windmills and clogs 70% 60% 50% 40% 30% 20% 10% 0% expensive well accessible surprising destination easy going Brazil visitors Brazil non-visitors The Brazilian* consider Holland as an easy going country which offers good quality and as a country that has a lot to offer in terms of art and culture. More than half of the Brazilian considers Holland as an expensive destination. Especially non-visitors are less aware of the fact that Holland has many things in close proximity. many things in close proximity good service offers a lot in terms of architecture and design good quality offers a lot in terms of art and variety, diversity culture more to offer than A'dam Source: NBTC Holland image study (2012) Image of the Dutch people sporty reliable 90% 80% enterprising More information on this image study on www.nbtc.nl 70% pragmatic/result-oriented internationally-oriented businesslike 60% 50% 40% 30% 20% 10% 0% innovative open tolerant Brazil visitors Brazil non-visitors Brazilian* people are very positive about the Dutch population. Brazilian consider the Dutch open, tolerant, ingenious/inventive, helpful, hospitable/welcoming and enterprising. Relatively low scores were given by the Brazilian for pragmatic/result-oriented, internationally-oriented and businesslike. * Brazilian from Rio de Janeiro and sao Paulo arrogant ingenious/inventive Source: NBTC Holland image study (2012) hospitable/welcoming helpful friendly 13

Trends and developments The economy in Brazil is in a recession. The forecast is that the recession will continue in 2017. Over the medium term, economic growth is projected to rise over the medium term. The country does need structural reforms to make this growth possible. The seat capacity from Brazil to Holland keeps on increasing. This makes further growth of the number of Brazilian guests to Holland possible. European destinations remain very popular amongst Brazilian long haul travelers. This is because the strong cultural links between the country and the European continent. Also Europe offers many cultural/historical attractions and shopping opportunities which are very appealing to the Brazilian travelers. Shopping is a strong motivational factor to travel abroad. Although more and more Brazilian from the middle class are able to travel, long haul travelers are still moreover well educated people from the higher social classes and from the big cities São Paulo or Rio de Janeiro. 14

Destination Holland: SWOT Strengths High popularity of Amsterdam Interest in Dutch culture/folklore Compact: short distances between cities, short travelling time Holland is small, which makes it easy to combine with visits to one or more other European countries No visum required Direct flights from Sao Paulo and Rio de Janeiro Many restaurants, bars and cafes Brazilians have a positive image of Holland & the Dutch Weaknesses Preference for countries where many Brazilian or their ancestors come from (Portugal, Germany, Italy) Holland is less popular for a single destination tour; the average stay is short Quality of service in hotels, restaurants, bars and cafes Opportunities High popularity of European countries, because of history/origin Growing population that is financial able to travel Luxury segment Improving infrastructure in Brazil means better accessibility of the airports Growing use of (mobile) internet/social media Increased flight capacity Threats Expensive (accommodation, transport, guides) compared to other European destinations Limited 3/4 star hotel capacity Huge competition between countries in Europe but also with short haul destinations/us Economic recession which is forecasted to continue in 2017 15

Holland Marketing in Brazil 16

Contact More information or advice? The MarketScan is a product of NBTC Research. NBTC can offer your organisation tailor-made advice for instance about local network (trade and press), local market opportunities, cultural expertise, advice on marketing, communication, co-marketing opportunities etc. Office Contact NBTC Holland Marketing Ms. Carola van Rijn P.O. Box 63470 2502 JL The Hague The Netherlands +31 (0)70 370 53 89 cvanrijn@holland.com 17

References Braztoa Yearbook 2017 Centraal Bureau voor de Statistiek, 2017 (www.cbs.nl) CIA World Factbook, 2017 (www.cia.gov) Currency-converter.net emarkter (http://www.emarketer.com/) IMF, 2017. World Economic Outlook Database (www.imf.org) Instituto Brasileiro de Geografia e Estatítica (www.ibge.gov.br) NBTC Holland image study, 2012 NBTC Statistics Incoming Tourism, 2014 NBTC The Future Perspective Destination Holland 2025 OECD, Brazil - Economic forecast summary, June 2016 & OECD Tourism Trends and Policies 2016 Phocuswright, Latin America Online Travel Overview Third Edition, 2016 RDC Apex (www.rdcapex.com) Wearesocial & Hootesuite,2017 (https://www.slideshare.net/wearesocialsg/digital-in-2017-south- America) World Travel Monitor 2017 18