Average total increase is 13% while increase in leisure travel is higher at 15% including 32% in 2011
The Russian market – Flanders Connection 2012
Content Background to the Russian market 1.1 Russian Travel Trade Structure and Statistics 1.2 Russian Travel Market Key Facts 2 Travel Destinations for Russians 2.1 Where do Russians travel in Europe 2.1 Key Assets of Flanders for Russian travellers 3 Russian traveller Profile- Key Segments 4 How to reach the Russian market
Russia at a GlancePopulation: 142 million (9th in world)Language: RussianCapital: Moscow (GMT+4)GDP: US$ 1,850 Bln (9th in world)Economic Growth 3.7% in 2012GDP per Capita: US $13,000 (53rd in world)Cities with the population over 1 million Moscow 10.6 St Petersburg 4.6 Novosibirsk 1.4 Yekaterinburg 1.3 Nizhny Novgorod 1.3 Kazan, Samara, Omsk and Chelyabinsk 1.1 Rostov & Ufa 1.0`
Background to the Russian market 1.1 Russian Travel Trade Structure and Statistics
Russia outbound travel Rest of World Central/Eastern EuropeMillion Southern Europe30 Western Europe Northern Europe25201510 5 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011*Outbound travel defined as tourist arrivals to all destinationsSource: Tourism Economics
Russian Growth Continues Unabated Visits from Russia to select destinations 2012, year-to-date*, % change year ago 60 80> 50 40 30 20 10 0 -10 Malta Latvia Slovenia Montenegro Cyprus Italy Czech Republic Germany Iceland Poland Lithuania Slovakia Spain Estonia Romania Serbia Hungary Austria Croatia Netherlands Bulgaria Belgium United Kingdom Source : TourMIS *date varies (Mar-Aug) by destination
2011 & 2012 Tourism Statistics 2011 Russian outbound Tourism statistics • Russian market grew +11% in 2011, previously grew at 18% per year 2004-08 • Leisure traffic up 15% • Business Travel traffic up 7% • Total no. of visits abroad 43.7 million • Leisure Travel reached 14.5 Million 2012 Russian Statistics so far… • 2012 Jan-June Russian Market grew by +6.6% • Total no. of visits abroad 20 million • Leisure Travel reached 6.5 Million
Background to the Russian market 1.2 Russian Travel Market Key Facts
Key Facts: Russian Travel Market Russia is the 5th largest out bound travel market in Europe and the 9th largest market in the World, according to Boston Consulting Group Wealth is concentrated in a few cities of more than 1 million people, easy to target. Russian travel spend is impressive: 2011- an average of 677 US$ per trip, with many tourists to Europe spending substantially more 2011- 22% in total market figures and is still growing…
Consolidated of Russian Travel Industry • Consolidation since 2007 due to introduction of a new law on Tour operators, Moscow companies now dominate and control charter flights from regional cities to key mass market destinations. • The entry of international players, including Kuoni (Megapolus), TUI Russia & Ukraine joint venture and in 2011 Intourist & Thomas Cook created a joint venutre Turkish TO‟s such as Odeon Group, Pegas Turistic dominate mass market destinations
High Spend and High Growth • Russians are high spenders, they rank as no. 1 (non- EU)spenders at 5 out of 8 designer villages in Europe. Kazakhs also rank in the top 10 spenders of 4 • 3rd Fastest growing travel market in the world after India & China, average growth rate of 18% from 2004-08. Growth rates in Europe average above 25% per year. • Russia remains a “star performer as a source market”, according to the ETC with Growth rates exceeding 10% in 70% of European markets in 2012
Increasing Role of Online Booking 18% of all on-line Traffic in Russia is Travel-related 70% of internet bookings are for destinations abroad Under 40‟s are the dominant users International online companies reported a 450% increase in profits in 2009 while the total market went down by 19%
Seasonality of Russian Holidays Key months for Summer Holidays are: • May & June: 11% • July & August: 45% • Sept: 19% Other peak periods are: • January 1st -10th Official New Year & Orthodox Christmas break • May 1st -10th Labor Day May 1st- 2nd and Victory Day May, 9th • Nov & March Children Half- term holiday. Important for families with children school age
Key Russian Travel Destinations 2.1 Where do Russians travel in Europe ?
Top 10 European Destinations in 2010 Country % growth- 2010 Turkey 22.6 % Finland 34.3% Germany 52.2 % Italy 34.6 % Spain 76.3 % Greece 75.5% Czech Republic 37% France 10.4% Cyprus 42.7% Bulgaria 40%
2011 Traffic Increase to Europe Success Stories for 2011Estonia +118% Norway +100%Sweden +99% Greece +58%Spain +57 % Germany +49%Austria +41% Cyprus +38%Czech Republic + 37% Bulgaria and the UK +29%Flanders (including Brussels): + 29.7%.
2.2 Key Assets of Flanders for Russian Travellers• Potential ‘ city break’ destination- newly developed product• Good flight accessibility.• A High quality and diverse products, such as fashion, gastronomy and heritage• Attractive for 1st time travellers as well as sophisticated FIT market• Year round appeal• Russians have still to recognize Flanders potential in terms of a gourmet and beer destination.• FIT segment is looking for an experience not just a destination, Flanders can fulfill that expectation.• Flanders has all the characteristics to become an incentive destination for the Russian market, as knowledge of the product is developed
3. Russian Traveller Profile and Segments Russian Travel Characteristics and Segments
Who is the Russian Tourist • Younger than European average, require flexibility & fun • Extravagant spenders and Expect 24 hours service • Glamour & Style Addicts: Designer Hotels and fashionable clothe brands • Brand oriented: but discerning (value niche brands) • Love Sushi and Sea food • Entertainment means Drinking, Eating & Music • Hedonistic lifestyle and Not as “Green” as other European travellers • Russians love the Seaside and warm weather as well as chic urban destinations
Group & FIT Russian visitorsBasic profiles of Russian visitors to Flanders:• the 1st timer- Group Visitor - often visiting Europe for the 1st time, with limited language skills and travelling in a group with Russian speaking guides• The more Sophisticated FIT traveller, who has already visited many European countries, often speaks English and wants to gain „an experience‟ from the visit to Flanders and prefers to travel in the company of friends of as a couple or a family.
Russian Segments • High Network Individuals (VIPs) • Families • Experience Seekers • MICE groups
Key Leisure High Net Worth Families ExperienceSegments Individuals (VIPs) SeekersBooking habits VIP travel agency Travel agent Internet or via or concierge service special interest travel agents High Net worth net Worth Families ExperienceAge range individuals (VIPs) Individuals 37-50 years Seekers 28- 42 years 25- 50 yearsGeographic source Mainly Moscow, as All key urban cities Sophisticated well as wealthy of 1 million Urban cities with regional cities high levels of educationMarket Share 15% 50% 35%Monthly Income 10,000 Euro ++ 1,200- 2,500 Euro 1,500- 5,000 EuroSeasonality Year round but Limited to schools Summer holidays, especially summer holidays, summer May holidays and and Jan, as well as and May holidays New year and short short breaks holiday breaksInterest in Flanders Good to High Medium to good High potential- potential if have potential but highly Flanders is a good tailor made tour price conscious match for them
Targeting the Russian MICE Market • Key Characteristics • Age: 30-50+ • Geographic source market: all large cities in Russia, but 90% of all requests come from Moscow incentive houses or MICE companies • How do they travel: corporate groups for Visa destinations are from 20-50 persons • Key characteristics: Mainly MEET- CENTIVE segment, good meeting facilities, including free internet, 24 service, creativity and unique programmes, competitively priced with something special • Income: Trip is sponsored by the employer so highly variable budget. • Seasonality: Autumn and Spring • How do they book: via a specialized MICE agencies and incentive houses • Normally require direct flights or book full charters and will not fly more than 5 hours for large groups • Characteristics • Corporate non-luxury policy often limits accommodation to 4* hotels • Large conference facilities not required • Fun trips, similar to Leisure but with a creative component
4. How to target the Russian Market • Workshops • Individual sales calls • Branded road-shows and events • Be informed- sign up for TMI E market update
Branded Road-showsFeb 12-15th, 2013- 1st Flanders Roadshow in Russia (Moscow & StPetersburg)This is the most targeted way to access the high spend individual via luxurytravel agents as well as key tour operators linked to the group market.
Be better InformedTMI - Russian Travel Intelligence Brief A free monthly Russian market intelligence Brief. It provides up-date travel statistics and future travel trends in the Russian market Requests to email@example.com We are your Flanders Office in Russia Tel: +7 495 787 2753
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