Marketing Research » Market Trends

What you'll learn this session

Study time: 30 minutes

What market trends are and why they matter in travel and tourism
How to identify and analyse different types of market trends
Methods used to collect market trend data
How tourism businesses use trend analysis to make decisions
Real-world examples of market trends affecting the travel industry

Introduction to Market Trends

Market trends are patterns or changes in the way people buy and use travel and tourism products and services. Understanding these trends helps businesses make smart decisions about what to offer customers and how to stay ahead of competitors.

Key Definitions:

Market Trend: A pattern or shift in the way consumers behave or make purchasing decisions in a particular market.
Consumer Behaviour: How people decide what to buy, when to buy it and why they make those choices.
Market Research: The process of gathering information about what customers want and need.

📈 Why Market Trends Matter

For travel and tourism businesses, keeping track of market trends is crucial because:

They help predict what customers will want in the future
They show opportunities for new products or services
They help businesses stay competitive
They reduce the risk of investing in products nobody wants

📊 Types of Market Trends

Market trends can be categorised in different ways:

Short-term: Temporary changes (e.g., sudden interest in a destination after a popular film)
Long-term: Lasting changes in behaviour (e.g., increased demand for eco-friendly travel)
Seasonal: Regular patterns that occur at specific times (e.g., summer holiday bookings)
Cyclical: Patterns that follow economic cycles (e.g., less luxury travel during recessions)

Identifying Market Trends

To spot market trends, tourism businesses need to collect and analyse different types of data. This helps them understand what's happening now and what might happen in the future.

Methods of Collecting Market Trend Data

Tourism businesses use various methods to gather information about market trends:

📝 Surveys & Questionnaires

Asking customers directly about their preferences, experiences and future plans. These can be done online, in person, or by phone.

Example: A hotel chain sending email surveys to guests after their stay to track changing preferences.

🔍 Market Research Reports

Professional reports that analyse industry data and provide insights about current and future trends.

Example: VisitBritain publishing reports on international visitor patterns and spending habits.

💻 Social Media Analysis

Monitoring what people are saying about destinations, experiences and travel preferences on social platforms.

Example: A tour operator tracking Instagram hashtags to identify emerging popular locations.

Key Market Trends in Travel & Tourism

The travel and tourism industry is constantly evolving. Here are some significant trends that have emerged in recent years:

🌲 Sustainable Tourism

More travellers are concerned about their environmental impact and seek eco-friendly options. This includes:

Carbon-neutral travel options
Accommodation with green certifications
Local and community-based tourism experiences
Reduced plastic use and waste

Businesses are responding by highlighting their sustainability credentials and developing new green products.

📱 Technology-Enhanced Experiences

Technology is changing how people research, book and experience travel:

Mobile booking and check-in
Virtual reality previews of destinations
AI-powered personalised recommendations
Contactless payments and digital room keys
Real-time translation services

🏠 Authentic Local Experiences

Travellers increasingly want to experience destinations like locals rather than tourists:

Homestays and local accommodation options
Food tours featuring local cuisine
Cultural immersion activities
Learning traditional crafts or skills

This trend has led to the rise of platforms like Airbnb Experiences and local-led tours.

🏆 Luxury and Wellness Travel

There's growing demand for high-end experiences focused on wellbeing:

Luxury wellness retreats
Mental health and mindfulness holidays
Medical tourism
Personalised fitness programmes
Digital detox experiences

Analysing Market Trends

Once data is collected, businesses need to analyse it to understand what it means for them. This involves looking for patterns, comparing data over time and making predictions about future trends.

📊 Quantitative Analysis

Looking at numbers and statistics to identify trends:

Visitor numbers and demographics
Booking patterns and seasonal changes
Average spending per visitor
Length of stay
Market share compared to competitors

💬 Qualitative Analysis

Understanding the reasons behind the numbers:

Customer reviews and feedback
Focus group discussions
Social media comments and sentiment
Interviews with industry experts
Cultural and social factors influencing choices

Case Study Focus: COVID-19's Impact on Travel Trends

The COVID-19 pandemic created one of the most dramatic shifts in travel and tourism market trends in recent history:

Rise of domestic tourism: With international travel restricted, many people explored destinations closer to home. UK seaside towns like Cornwall and Devon saw record visitor numbers in summer 2021.
Health and safety focus: Cleanliness and hygiene became top priorities for travellers, with hotels implementing enhanced cleaning protocols and contactless services.
Flexible booking policies: Uncertainty led to demand for free cancellation and flexible rebooking options, which many businesses had to adopt to remain competitive.
Workations: Remote working enabled people to combine work and travel, leading to extended stays and a new market for accommodation with good workspace facilities.

Many tourism businesses had to quickly analyse these emerging trends and adapt their offerings to survive the pandemic.

Using Market Trends to Make Business Decisions

Understanding market trends helps tourism businesses make important decisions about their products, marketing and future plans.

🚀 Product Development

Creating new offerings based on identified trends:

Example: A tour company adding sustainable wildlife tours after noticing increased interest in eco-tourism.

💰 Pricing Strategies

Setting prices based on what the market will pay and competitor analysis:

Example: A hotel introducing premium "workation" packages with dedicated workspace after identifying this growing market segment.

📢 Marketing Campaigns

Targeting communications based on trend insights:

Example: A destination marketing organisation highlighting local, authentic experiences in their social media campaign after research showed this was a key driver for visitors.

Challenges in Market Trend Analysis

While market trend analysis is valuable, it comes with several challenges:

Rapid changes: Trends can shift quickly, making it difficult to respond in time
Data reliability: Not all data sources are equally reliable or representative
Interpretation: The same data can sometimes be interpreted in different ways
Global vs local trends: What's trending globally might not apply to specific local markets
Resource limitations: Small businesses may lack the resources for comprehensive trend analysis

Mini Case Study: TUI's Response to Sustainability Trends

TUI, one of the world's largest travel companies, identified the growing trend towards sustainable tourism through their market research. In response, they:

Launched their "Better Holidays, Better World" strategy
Committed to delivering 10 million "greener and fairer" holidays per year
Invested in more efficient aircraft to reduce carbon emissions
Created a certification programme for hotels meeting sustainability criteria
Developed marketing campaigns highlighting their environmental initiatives

This strategic response to market trends helped TUI appeal to environmentally conscious travellers while also reducing operational costs through efficiency improvements.

Summary: Key Points About Market Trends

Market trends reveal patterns in consumer behaviour that help businesses make informed decisions
Trends can be short-term, long-term, seasonal, or cyclical
Data collection methods include surveys, market research reports and social media analysis
Current significant trends include sustainable tourism, technology integration, authentic local experiences and wellness travel
Businesses use trend analysis for product development, pricing strategies and marketing campaigns
Responding effectively to trends can provide competitive advantages and new business opportunities

Understanding market trends is essential for success in the travel and tourism industry. By keeping track of how customer preferences and behaviours are changing, businesses can stay relevant and meet the evolving needs of travellers.