Factors affecting tourism demand

Factors affecting tourism demand

This article aims to explore the key factors affecting tourism demand globally. Tourism is a massive global industry with over 1.5 billion tourists virtually visiting every corner of the world every year. Its global market size is expected to go well over $1.67 trillion by the end of 2022 (Statista, 2022). Its demand is affected by several price and non-price factors.

Definition of tourism demand

According to IGI Global (2022) tourism demand is defined as the number of people that plan to buy tourism products supported by sufficient purchasing power and spare time in order to meet tourism needs of people. For a better understanding of tourism demand, it is useful to differentiate between the demand for travel to a destination and the demand for particular tourism related products or services within the destination e.g. hotel rooms, restaurant meals, tours etc.

Factors affecting tourism demand

Tourists are of many different types. For instance, business tourist, education tourist, medical tourist, adventure tourist, religious tourist, leisure tourist, and sports tourist are to name but a few. Tourist destinations and attractions develop their tourism plans in line with the tourist motivational factors and demand. Many factors impact on tourist demand; however, this article addresses the primary factors affecting tourism demand.

Factors affecting tourism demand can be divided into two categories i.e. price factors and non-price factors. There are many factors which we need to consider under each category.

Price factors affecting tourism demand

How much is the transport cost for a tourist to go to a destination? Flight prices change often, and the price tourists pay depends on the day they fly, when they book, and the number of available seats in airlines. Flights prices also depend on tourist destinations. So, costs could be high or low.  For example, a tourist can travel from London to Paris with £20 or less. However, sometimes they need to pay more than £100. A flight from London to Dubai may cost £300 or more. Therefore, whether a tourist will travel to a destination or not may depend on transportation cost.  It is important to note that different airlines have different pricing policies.

Cost of accommodation, food, shopping, and entertainment also impact on tourism demand. For example, food is usually expensive in Switzerland while it is cheap in India, Thailand, Pakistan, Bangladesh, the Philippines, South Africa, China, Morocco, Egypt, Argentina and many other developing countries.

Exchange rates also impact on tourism demand. It is very evident from the recent developments in the UK. Inbound tourism is booming in the UK due to weak pound. In this regard, the readers should find the article What is the impact of a weaker Pound useful.

Non-price factors affecting tourism demand

There are a number of non-price factors that can affect tourism demand. For example, destination image is an important factor. UK is positioned as one of the best countries in the world with a great number of historically significant attractions and world heritage sites. This is perhaps enough for many tourists to visit the UK. Likewise, countries such as France, the United States, and Turkey attract millions of tourists every year as people perceive them as great holiday destinations.

Taj Mahal in India, the Great Pyramid of Giza in Egypt, the Eiffel Tower in France, Grand Canyon, Niagara Falls, and Walt Disney World Resort in the USA, Tower of London in the UK, Hagia Sophia in Turkey, and the Great Wall of China are some of the best visitor attractions in the world. Millions of people visit them every year. This demonstrates that visitor attractions are one of the key factors affecting tourism demand.

Immigration systems in a country may also impact on tourism demand. Flexible and accelerated visa processing systems often motivate tourists to travel abroad. Likewise, free movement of people agreements among countries impact on their national tourism demand. However, it may work other way round as well. For instance, tourists from developing countries often find it difficult to travel to developed countries due to rigid immigrations systems.

Weather conditions also play an important role in tourism demand. Tourists often go to destinations in search of sunshine. Likewise, winter is perhaps the only solution for many attractions promoting skiing. Heavy rains and floods usually impact on tourism demand in any destination.

Internet has brought about revolutionary changes to everything and every corner in the world. Unsurprisingly, tourists are reaping the benefits of it. It can help them get a clear idea about the destination they are planning to visit including its facilities, services, and visitor attractions. Once the visit is over (very often while it is still going on!), many tourists share their experience and views on social media and other online platforms. These views guide many potential visitors and impact on their purchase decisions.

Global events can dramatically increase tourism demand. For instance, Qatar received over 765,000 visitors during the first two weeks of the World Cup Football, even though the estimated fan number was 1.2 million (Mills, 2022). This is a huge number for Qatar compared to the usual number of tourists it attracts every year.

We hope this article on factors affecting tourism demand has been useful. You may also like reading Impact of tourism and An introduction to the tourism industry in the UK. If you liked this article, please share the article link on social media to support our work.

Last update: 11 December 2022

References

IGI Global (2022) What is tourism demand, available at: https://www.igi-global.com/dictionary/the-impact-of-exchange-rate-on-tourism-industry/49776 (accessed 10 December 2022)

Mills, A. (2022) Exclusive: 765K World Cup visitors fall short of Qatar’s expected 1.2M influx, available at: https://www.reuters.com/lifestyle/sports/soccer-765k-world-cup-visitors-fall-short-qatars-expected-12m-influx-2022-12-07/ (accessed 11 December 2022)

Statista (2022) Tourism sector’s market size worldwide, available at: https://www.statista.com/statistics/1220218/tourism-industry-market-size-global/ (accessed 11 December 2022)

Author: M Rahman

M Rahman writes extensively online and offline with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University.