Travel TrendsExperience economy given a boost as travellers ditch retail for rock and (spring) rolls.

Souvenirs, who needs them? Travellers just wanna have fun

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Tourism spending on "experiences" is roughly 34% above 2019 levels and has outpaced spending on "things" since July 2021, according to the Mastercard Economics Institute's third-annual travel report.
Tourism spending on "experiences" is roughly 34% above 2019 levels and has outpaced spending on "things" since July 2021, according to the Mastercard Economics Institute's third-annual travel report. Photo Credit: GettyImages/Wiphop Sathawirawong

Forget the souvenir of the Japanese geisha girl; flick past the Merlion keyring and leave the cuddly koala toy on the shelf. Post-pandemic travellers are shrugging off souvenirs, instead demanding experiences to compensate for almost two years of lockdown.

Tourism spending on "experiences" is roughly 34% above 2019 levels and has outpaced spending on "things" since July 2021, according to the Mastercard Economics Institute's third-annual travel report, Travel 2022: Trends & accommodations, and spending on the ground.

The return of the Experience Economy is a global trend, Mastercard says. “In 2020 and 2021, spending made a sudden, but not surprising, shift from services to goods. However, spending is now shifting back as travellers seek out experiences on vacation instead of souvenirs.

“For example, through April 2022, our analysis shows that tourism spending at bars and nightclubs is 72% above 2019 levels, while spending at restaurants is 31% above.

“Tourists are also spending 35% more on amusement parks, museums, concerts and other recreational activities. By comparison, tourist spending on apparel, department stores, cosmetics and other retail categories is down compared to 2019,” Mastercard reported.

By comparison with Europe where the experience economy is booming, Mastercard found markets across Asia are a little more mixed.

South Korea, where borders opened in April 2022, has seen virtually no inbound tourism, and Indonesia has seen less tourism for similar reasons. Singapore, by contrast, has enjoyed robust tourism demand for experiences and things through April 2022.

Other big winners as international travel returns:

Cruise breezes back: Despite huge challenges in the cruise industry, Mastercard’s research shows spending on cruises globally, including bookings, is roughly one-tenth below 2019 levels.

“This is another turnaround story, having started the year at roughly minus 75% below pre-pandemic levels.”

Business travel picks up: Business travel has staged an impressive comeback, according to an analysis by the Mastercard Economics Institute.

At the end of March 2022, business flight bookings exceeded 2019 levels for the first time since the pandemic started. Data through April 2022 points to this trend continuing.

A word of caution: Higher costs for airlines have contributed to higher fares for travellers. Through April 2022, the average airfare that travellers paid adjusted for the distance flown increased roughly 18% since the start of the year.

In Singapore, prices were recently pushing 27% of 2019 levels through April 2022. Mastercard says this partly has to do with supply-side constraints, most markedly in the labour market.

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