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Research Quantifies the Impact of Group Travel

Group travel is big business — perhaps much bigger than many people realize.

Media pundits, policymakers and industry analysts often think of travel and tourism as predominantly business or family affairs. The leisure group tourism segment of the industry often gets little notice in discussions of travel economics, but perhaps it should. Because this “small” sector of the travel business has a large impact.

Several studies in recent years have shed significant light on the revenue and jobs created by packaged group travel. In December 2014, the United States Tour Operators Association (USTOA) released the results of a biennial study done in partnership with PriceWaterhouseCoopers. It showed that the association’s members contributed $12.5 billion to the U.S. tourism industry in 2013, representing more than 7.6 million travelers. For 2014, those numbers rose to $13.5 billion and nearly 8 million travellers. USTOA includes more than 50 of the country’s largest tour companies and cruise lines.

The study also found that USTOA member activity created 11,800 jobs in the United States in 2013, a number that grew to 12,350 in 2014. In 2013, members were responsible for more than 16.3 million hotel room night bookings, 4.55 million airline seats, 3.7 million travel packages and $9.4 billion in travel-related goods and services. The study predicted growth in all of those areas for 2014.

“Numbers don’t lie — this vital information on sales, jobs, the impact on our hotel and airline partners, the role of travel agents and the forecast for the future paints an accurate picture of how integral our members are in the health of the industry overall,” said USTOA president Terry Dale. “The members of USTOA represent a significant footprint in our industry.”

Studying the South

Another study reinforces the economic power of the packaged travel industry by examining the economic impact of group trips in 12 states in the American South. Conducted by Travel South USA in cooperation with the ABA Foundation, this study found that group tours created a total economic impact of more than $19 billion.

The study found that more than 33.3 million travelers took trips within the South during 2014, generating more than 10.8 million overnight tours and 22.3 million day trips. Those overnight travelers represented more than 21.7 million room nights.

“The data shows that the group travel segment is alive and well, is significant to the travel industry and is really important within the South,” said Travel South USA president Liz Bittner. “Group travel is here to stay. The naysayers have long said that it’s a dying breed and that baby boomers won’t get on motorcoaches, but I don’t think that’s true.”

The survey also looked at the types of hotels used by group travelers in the South. It found that 15 million of those room nights were at moderate or midscale hotels. Surprisingly, upscale and luxury hotels represented more than 6.2 million room nights.

“I was really pleased with the number of room nights that the South hosts, both in the midlevel hostel segment and the luxury and upscale segment, too,” Bittner said. “The whole myth about group travel being all day-trippers who don’t spend any money or folks who are always looking for the least expensive hotel — it’s just not true.”

A Bright Future

USTOA and Travel South USA are both working on follow-up studies to show updated statistics for 2015 and 2016. And though it will be some time before those numbers are concrete, both Dale and Bittner said all signs point to continued growth for group travel.

“According to the most recent trends and forecast survey, the tour operator members of USTOA showed strong growth in 2015, with more than a third attributing growth to an improved economy and higher consumer confidence,” Dale said. “It’s also encouraging that a majority — 57 percent — are optimistic about continued growth in sales in 2016, and nearly half plan to increase staff.”

Travel South USA is capturing data now to make available in a report in 2017.

“Anecdotally, based on our working in the market and our successes at our last two showcases, we think that 2015 and 2016 are up as well,” Bittner said. “I’m looking for double-digit increases.”

Brian Jewell

Brian Jewell is the executive editor of The Group Travel Leader. In more than a decade of travel journalism he has visited 48 states and 25 foreign countries.