VUSALA EYNULLAYEVA 2368 MANAGEMENT CONSULTING LABS FALL 2016
Agenda 1 1 The Project 2 Methodology 3 3 Tourism in Europe 4 4 Itinerant tourism 5 Potential itinerant market I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 2
CONTEXT Analyze tourism market in Europe To measure the size of the potential market in Europe for Indie Campers The project will serve for the company s growth strategy plan in 2020 Calculate potential itinerant market Analyze itinerant market in Europe Less academic and very direct A separate project counted within a group Some data was shared and exchanged with group members I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 3
COMPANY OVERVIEW Target market is the rent of campervans Currently serving 13 cities located in Portugal, Spain, France To provide the enjoyable road travel with low-cost rentals that can be easily accessible to everyone A start-up company established by two friends in 2011 in Lisbon Owned 95 campervans Predicted financials Sales 1.5 m Ave. Sales per booking 1100 Expand through Europe s recreational vehicle market and dominate it by providing, sustainable and honest industry practices I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 4
METHODOLOGY I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 5
METHODOLOGY Internal sources The company s database was used to understand current market size and potential and to forecast market size Data Analysis External sources A collective data about tourism, itinerant market in European countries were collected, sorted analyzed based the certain indicators I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 6
METHODOLOGY Internal sources The company s database CRM platform pre-booking process is controlled through this database Booking platform post-booking process is tracked in this database Financials Future sales estimations, expansion plan, statistics data provided by team members of different departments I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 7
METHODOLOGY - EXTERNAL SOURCES External sources Statistics & reports produced by the European organizations The different state and government statistics database The aggregate companies official data Tourism in Europe Sample: 25 European countries Indicators: Inbound and Outbound tourism, Domestic tourism, purpose of visit, destination, seasonality of the visits and arrivals and nights spent at tourist accommodations The Analyze process Itinerant Market The potential market volume Competitors: direct(campervans) and indirect(motorhomes) Indicators : RV stopovers, campsites, motorhome ownership, the nights spent in RV Calculated based on the market size of Portugal in 2016 The growth of market is projected to be 10% Evaluation method was suggested by Hugo( Funder, CEO of Indie Campers) I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 8
TOURISM IN EUROPE I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 9
INBOUND TOURISM 450 400 350 300 250 200 150 100 50 - The number of arrivals and nights spent and at tourist accommodation, in million Number of arrivals at tourist accomodation Nights spent at tourist accommodation establishments Source: Eurostat, 2014 Germany, France, UK, Spain and Italy were the dominant countries in both indicators in the tourism sector among sample European countries. It can be explained by the economic power, airport traffic, natural wonders and historical sites of those countries attract tourist flows The countries such as Spain, Italy, Greece, Austria and Portugal differentiated by its disorder in nights spent trendline. It illustrates that the mentioned countries were visited by less tourists who tended to stay longer The opposite case could be seen in the countries such as Germany, UK,Norway and Sweden Close proximity neighboring countries makes traveling easier to move from one place to another and results in decreasing days spent in host country, but increasing in the frequency of visits Airport traffic let have more stopovers thereby more visitors with shorter period Cheaper and diversified options available let spend longer vacation in one place I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 10
INBOUND TOURISM DOMESTIC & FOREIGN Average nights spent per arrival # Nights spent # Arrivals The ratio helps to better characterize inbound tourism (Domestic&International) considering the size of country The calculation yields a higher result for Denmark compared to its neighbors such as Nordic countries, 4 and 2 nights spent respectively Source: Eurostat, 2014 The order of countries completely changed when considering only the foreign arrivals. UK, Spain, Bulgaria, Greece, Croatia and Ireland concluded to the highest number of nights spent at tourist accommodation Source: Eurostat, 2014 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 11
INBOUND TOURISM DOMESTIC & INTERNATIONAL TOURISM Sensitivity on number of arrivals, % Sweden Germany United Kingdom Poland Norway France Netherlands Switzerland Italy Spain Czech Republic Belgium Portugal Greece Austria 0% 20% 40% 60% 80% 100% Domestic Foreign Source: Eurostat, 2014 Domestic travelers in term of tourist arrivals were more active in France and onward countries in the graph recording more than 70% However in the rest of countries Foreign tourist occupied more portion of arrivals Having inspirational destinations within a country Higher standard of living let solve price and access issue Seasonal(summer/winter) tourism let attract international visitors to those countries as popular destinations thereby exceed domestic arrivals in the number A similar picture was observed in the nights spent indicator. Foreign tourists tended to stay longer in their visits in the countries recorded below Italy in the graph Poland Germany Sweden Norway France Netherlands United Kingdom Switzerland Italy Czech Republic Belgium Spain Portugal Austria Greece Sensitivity on nights spent, % 0% 50% 100% Source: Eurostat, 2014 Domestic Foreign I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 12
INBOUND TOURISM COASTAL AND NON-COASTAL DESTINATION 100% Nights spent in Coastal and non-coastal tourist accomodation 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Coastal Non-Coastal Source: Eurostat, 2014 The European countries have coastal area are selected from the sample countries to achieve a fair comparison In Portugal, Denmark, Croatia and Greece, the tourists prefered to spend in coastal area of the country by recording 87%, 91%, 94% and 95% accordingly Following factors can be contributed to the drastic change in proportion of a figure Some countries popular for their coastal attractions, beaches, nature and exotic islands, in other words, for developed coastal tourism Some countries have smaller coastal area or less inspirational places to offer, so that it leads to dominance in non-coastal area Some countries have also advantage on urban tourism (shopping, historical sites etc.,) I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 13
INBOUND TOURISM SEASONALITY ON THE NIGHTS SPENT 100% 80% 60% 40% 20% 0% Domestic Summer Winter Source: Eurostat, 2014 The graph illustrates seasonality in Domestic tourism in each country. Based on result one can conclude how sensitive domestic tourist is to the seasonal change from May to October = Summer season from Nov to April = Winter season It could be observed that all countries excluding Switzerland had less than 50% portion of nights spent in winter season. The reason can be that many people have access to a vacation during summer season thereby almost all countries are more active in summer rather in winter Switzerland had favorable natural condition for winter and developed winter tourism I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 14
INBOUND TOURISM SEASONALITY ON THE NIGHTS SPENT 100% 80% 60% 40% 20% 0% Foreign Summer Source: Eurostat, 2014 The chart displays seasonality in International tourism in each country. It gives an insight on how sensitive the international tourists are to the seasonal change The findings based on this graph were a similar result as in the domestic tourism. Less than 50% of total nights spent in winter excluding Switzerland However, in detailed, the change between summer and winter was more significant than that in the domestic tourism meaning that a foreign tourist was more sensitive to the seasonal change. The Foreign tourists were prone to spend more nights in summer season Austria and Finland hosted approximately the same percentage of tourists during winter and summer. It was due to similarity in weather condition as well as the attractions offered during winter/summer time in each country Winter I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 15
INBOUND TOURISM DOMESTIC & INTERNATIONAL TOURISM 100% 80% 60% 40% 20% 0% Summer Domestic Foreign Source: Eurostat, 2014 The graph helps to compare the records of nights spent by Domestic and Foreign tourists in summer season. It also serves on finding out which market(domestic & International) dominates during summer season International tourism overshadowed domestic tourism in the countries in the graph starting from Croatia to Switzerland and by changing from ratio of 94% to 57% respectively. Favorable weather condition, coastline tourism, natural resorts and nature attract tourist flow Belgium, Italy and Czech Republic showed the same portion of domestic and international tourism market Domestic tourism dominated market in countries in the graph beginning from Hungary to Romania. It can be explained by several ways: people mentality to spend summer inside the country rather abroad, state put effort to develop domestic tourism, cheaper to spend domestically, a country's favorable weather and tourism offerings and etc., encourage them stay within country. Further it can be a case that country s not have a favorable offering for summer season thereby not attracting international tourist I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 16
INBOUND TOURISM DOMESTIC & INTERNATIONAL TOURISM 100% 80% 60% 40% 20% 0% Winter Domestic Foreign Source: Eurostat, 2014 The graph helps to compare the nights spent records of Domestic and Foreign tourists in winter season. It also serves on finding out which market(domestic & International) dominates during winter season In comparison to a result in summer season, in winter season the slight changes occurred in the order of countries excluding Greece and Bulgaria. International tourism held its leading position in previous countries in winter season as well. It can mean that the countries are not influenced much by seasonal change. Another explanation can be that domestic people less active on domestic tourism or domestic tourism is not developed in a country. As for the change on result of Greece and Bulgaria, the reason can be that the countries are more developed on summer tourism and attract foreigners with its summer tourism Italy kept being a favorite destination for both foreigners and domestics in both seasons The figure for Belgium and Czech Republic changed in winter season. In winter, the foreign tourists exceeds domestics by number of nights spent. It is possible that Christmas, New Year and overall winter tourism attract more foreign tourists I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 17
OUTBOUND TOURISM PURPOSE OF TRIPS 100% 80% 60% 40% 20% 0% Trips abroad for leisure purpose Leisure The chart depicts the percentage of trips made for a leisure purpose by a country of resident in abroad Other Source: Eurostat, 2014 On the graph, the countries to the left of Poland tended to spend holidays trips abroad. The percentage varies from 60% to 90% Following factors can considered explanation of a chart Higher standard of living exists in a country Geographical location(close proximity to other European countries) let them have the cheaper transport modes( a car, a bus, a train etc) Airport traffic let travelling be easier and cheaper More holiday days available I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 18
OUTBOUND TOURISM DESTINATIONS Data is calculated based on touristic trips(4 nights over) to abroad in the sample countries. Top 10 most visited destinations by the residents of sample country are collected. The countries are listed based on number of times being visited The chart illustrates the order of countries most visited and chosen for a holiday destination by the sample countries From the graph, it was seen that Italy, Germany and France were the most visited countries by a majority of the European countries. Source: Eurostat, 2014 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 19
ITINERANT TOURISM I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 20
ITINERANT TOURISM ACTIVE COUNTRIES Others United Kingdom France Italy Spain The number of nights spent in RV and camping grounds, in thousands Germany The Netherlands Croatia Sweden Denmark Norway Portugal Austria Switzerland Belgium Czech Republic - 50.000 100.000 150.000 200.000 250.000 300.000 350.000 The number of nights spent in RV and camping grounds Source: Eurostat, 2014 Top ten countries with the highest number are considered. The result of the remaining countries is summarized as Others A significant difference could be observed among countries. UK accounted for the highest result(327 388 thousand nights spent) which was three times more than France. France lagged behind UK by recording 109 743 thousands nights spent. The graph gives an insight on the existence, popularity and power of itinerant market in those countries It can be concluded that RV tourism is more developed in in top five countries(uk, France, Italy, Spain and Germany) I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 21
ITINERANT TOURISM RESIDENTS & NON-RESIDENTS 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% The proportion of nights spent in campgrounds, RV and trailer parks by residents and non-residents The chart illustrates the proportion of nights spent by resident and nonresidents in top ten countries where the most nights spent The countries in the chart beginning from Czech Republic to Italy displayed more than 50% occupation by residents in RV, campgrounds and trailer parks by meaning that the residents are active on itinerant tourism in their countries The foreigners were more active in itinerant tourism in countries such as Belgium, Austria and Croatia recording 57%, 78% and 97% respectively by resident by non-resident Source: Eurostat, 2014 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 22
ITINERANT TOURISM MOTORHOME OWNERSHIP Others Germany France Italy United Kingdom The Netherlands Sweden Belgium Finland Switzerland Spain 34 30 55 50 70 85 74 207 205 417 450-100 200 300 400 500 in thousands The number of the used Motor Caravans in the country Motorhome ownership can considered an indicator of itinerant tourism Top ten countries with the highest number is chosen Used Motor Caravans per 1000 capital helps to eliminate scale of country It could observed that the countries with highest result are Germany, France, Italy, UK and Netherlands The list of countries were same in the result of number of nights spent in RV, campgrounds and trailer parks indicators thereby confirms that those countries mature on itinerant tourism and longer experience of this market Considering this indicator per 1000 capital in each country, it can concluded that the residents of Finland and Sweden were active on itinerant tourism as well Source: European Caravan Federation, 2014 Source: European Caravan Federation, 2014 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 23
ITINERANT TOURISM STOPOVERS AND CAMPSITES Others Portugal Denmark Norway Sweden United Kingdom Spain The Netherlands Italy campsites motorhome stopovers The number of campsites and motorhomes stopovers existing in each country can serve as an indicator of the scale of potential of itinerant market Top ten countries the highest ratio is presented It could be seen that the same countries mentioned in the chart excluding Portugal However the order of countries changed. France overshadowed other countries with a significant amount of campsites In motorhome stopovers indicator, France, Germany and Italy shows a similar result Germany France 180 2.180 4.180 6.180 8.180 www.efcohpa.eu, 2016 en.camping.info, 2016 It should be mentioned that motorhome stopover is a direct indicator of itinerant tourism rather campsites. Since motorhome stopovers target the one who has recreational vehicle. Even considering so, the list of countries kept same I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 24
ITINERANT TOURISM COMPETITORS UK: The market players: Spaceships, Amber Leisure, Just Go, Hire buddies, Bunk Campers Motorhome, Wicked Campers, Camperbug DE: scheiber-reisemobile, pfaff-camping.at, Adventure Reisen, toureurope.de, McRent, Bauer Caravaning, DRM Motorhome FR: Van-it, Vintage Road Trips, Van trippers, Van-Away, Campy Camper, McRent, Camperbug, Evasia Motorhome Hire, Hertz Trois Soleils IT: Spicy Camper, Freedom Holiday, camperent.it, camperworld.it, Van Italy Campervan Rental, Caravan Campeggio, Meteor Viaggi ES: NorthSpain Camper Rental, Chilicampers, Flamenco campers, VanYou, Hangtime, South Camper I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 25
THE POTENTIAL ITINERANT MARKET I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 26
POTENTIAL ITINERANT MARKET 120.100.000 Potential market size per country, in 2016 100.100.000 80.100.000 The calculation is done considering potential itinerant market of Portugal in 2016 which is recorded 5 million 60.100.000 40.100.000 20.100.000 100.000 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 27
POTENTIAL ITINERANT MARKET Top 10 countries with highest itinerant market portion Others Croatia Austria 2% 2% 12% The potential market size is bigger in the countries that dominated itinerant market indicators as well Belgium 2% Sweden 3% Spain Netherlands 5% 5% Top countries Italy 11% Germany United Kingdom 17% 18% France 24% 0% 5% 10% 15% 20% 25% I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 28
FORECAST OF ITINERANT MARKET 800 Projection of market size in 2016-2020, in million 700 600 500 400 439 483 531 584 643 It was forecasted that market will grow by 10% in each thereby result 643 million potential itinerant market amount in 2020 300 200 100-2015 2016 2017 2018 2019 2020 2021 I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 29
THANK YOU FOR YOUR TIME AND ATTENTION I N D I E C A M P E R S M A N A G E M E N T C O N S U L T I N G L A B 30