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Italy Market Profile

In an Italian market in which consumers’ propensity to travel is steadily on the rise, California remains a particularly desirable destination for newlyweds. Tour operators who book tailor-made itineraries generally perform well, with honeymoon packages among the best sellers for them. In general, luxury or upscale packages combine California with other U.S. destinations.


MAJOR TAKEAWAYS

  • Disintermediation is growing
  • Italians’ propensity to travel increased from 66 to 69 points in 2016. 
 
  • “Bleisure” – combining business and leisure travel – trips are common practice
  • Millennials now have more incentives to visit California with first low-cost airlines launching in 2017
 

Italy Profile

180,000
In-Person Trips, 2017
$326 Million
Visitor Spending, 2017

Market Conditions

GDP Annual Growth Rate

  • In 2018 GDP is estimated to increase by 1.4 percebt. In 2017 exports increased by 4.8 percent while imports grew by 5.9 percent. This is expected to slow in 2018. Residential household consumption expenditure grew by 1.4 percent in 2017, but is expected to slow in 2018. The positive evolution in employment and the wage increase that go along with constant inflation are expected to support household purchasing power. Investment is expected to strengthen recovery further in 2018 (+3.3 percent).
  • Labor market conditions are expected to improve over the forecasting period. Employment will again slightly increase by 1.1 precent in 2018. Most importantly, the rate of unemployment is projected to decrease to 10.8 percent.

Exchange Rate


  • 1 Euro Equals 1.20 U.S. Dollar
  • The euro/U.S. dollar exchange rate has gained close to 13 percent in 2017, which partly reflects earlier weakness in the United States, but also underlines the scale of the shift in fortunes the currency bloc has undergone in the year to date.

Travel & Planning Methodologies

Airlift

  • Five weekly nonstop flights
  • 1,461 weekly nonstop flights
  • California is experiencing increased air service out of Italy with Norwegian providing new airlift to Los Angeles and Oakland out of Rome and legacy carrier Alitalia providing year-round nonstop service to Los Angeles.

Booking

  • Planning timeframe: up to six months
  • Booking timeframe: January–May for trips between May and October with peak in August
  • Over 60 percent of travel to California is booked through traditional tour operators and travel agencies, with the remaining booked through online travel agencies and directly with airlines and car rental companies.
  • More than 60 tour operators package California, offering escorted and tailor-made trips, including “Fly & Drive” (car, motorbikes) and “Fly & Train.”

Market Barriers & Risk Factors


Competitive Landscape


Other Market Insights

MARKET

  • Direct to consumer booking behavior is growing.
    • Retail travel agents are booking directly with U.S. suppliers and consumers are increasingly booking online.
    • To offset this trend, tour operators are investing in technology, trainings and travel agent fidelization campaigns. Honeymoon packages are still among the best sellers for tour operators.

PRODUCT EXPERIENCE

  • The United States is a prime long-haul destination for Italian travelers and California accounts for an approximate 20 percent share.
    • California is considered the preferred honeymoon destination for Italians and tailored packages are combined with New York, Las Vegas, National Parks, Hawaii, Polynesia or Cook Islands. Most around the world trips include a stopover in California.
    • “Fly & Drive” packages are very popular. “Fly & Train” packages are published in tour operator brochures.

AUDIENCE

  • Italians like to travel as couples, as group of family or friends.
    • Almost half of the Italian population takes at least one vacation per year. In 2016 17.8 percent of total trips were international trips. Fun and relaxation are the main holiday drivers in Italy and abroad, however, history, culture and arts account for 30.6 percent of international trips.
  • Since solo travel is a trend new to the Italian market, some tour operators have started to create dedicated products for single travelers.
  • Increased airlift and the addition of low-cost carriers with nonstop service to California projects an increase of Millennial visitors.

 


Sources

  • ISTAT (Italian National Institute of Statistics)
  • xe.com
  • DIIO
  • U.S. Department of Commerce
  • Tourism Economics
  • CIC Research, Inc.
  • GFK Market Research conducted in April 2017
  • L’Agenzia di Viaggi travel trade magazine
  • US Commercial Service Insights