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Scandinavia Market Profile

The Scandinavian countries of Sweden, Norway, Finland and Denmark constitute a small but important market for California. With six weeks of paid vacation annually, Scandinavians are heavily incentivized to explore the rest of the world. The proximity to so much of that rest of the world – Europe, Asia and the East Coast – makes California a longer haul. Still, Scandinavians are responsible for approximately half a billion in travel spending dollars annually.


MAJOR TAKEAWAYS

  • The United States is the top long-haul travel destination
  • Scandinavians now spend more than $30 billion a year on travel (approximately $4,800 per household)
  • Fly/drive itineraries are dominant in tour operator offerings, and customized itineraries are very popular
     
  • The foodie movement has awakened Scandinavians’ interest in culinary travel
  • Active vacations are gaining in popularity: 87 percent of Nordic travelers want to be active in natural surroundings
 

Scandinavia Profile

276,000
In Person Trips, 2017
$503 Million
Visitor Spending, 2017

Market Conditions

GDP Annual Growth Rate

GDP Annual Growth Rate grew 2.6 percent in the Scandinavia region in 2017, and is forecasted to grow by 2.8 percent in 2018. Inflation was 1.4 percent in 2017, and is predicted to remain stable in 2018. The unemployment rate is decreasing, from 6.2 percent in 2016, to 5.9 percent in 2017, and 5.7 percent (projected) in 2018.

Currency

  • Denmark, Sweden and Norway have maintained their local currencies with the Danish krone, Swedish krona and Norwegian krone (DKK, SEK and NOK). Finland adopted the euro in 2002.
  • DKK follows a fixed exchange rate against the euro.

Travel & Planning Methodologies

AIRLIFT

  • 247 weekly nonstop flights
  • 6,714 weekly nonstop seats
  • Scandinavia has seen a steady uplift in air service with Norwegian flying into Los Angeles and Oakland out of Oslo, Copenhagen and Stockholm. Finnair is servicing San Francisco from Helsinki, while legacy carrier SAS provides year-round lift round service to Los Angeles and San Francisco.

BOOKING

  • Scandinavians’ trip decision time is four months for travel to the United States. However, the booking period is becoming shorter, as Scandinavians are becoming more spontaneous, deciding timing and destination at the last minute.
  • There are only a few traditional tour operators in the market, who all sell California.
  • Many Scandinavians belong to the money-rich, time-poor segment and prefer to travel multiple times a year.
  • Tax returns and vacation pay are to a large extent spent on travel, which is why many book vacations during the months of March through May.
  • Scandinavians typically start the planning of their next holiday when returning from vacation.

SUMMER HOLIDAY

  • Type of vacation: 3-4 weeks (new, exciting destinations)
  • Booking timeframe: booked January-April (planning: November-January)
  • Travel period: June-August

Market Barriers & Risk Factors


Competitive Landscape

The below destinations rank as key competitors against criteria including flight connections/travel time, authenticity, and “Dream vacation.”


Other Market Insights

MARKET

  • Low-cost carrier Norwegian increased airlift to California, and more and more low-cost carriers are starting to offer one-stop flights from Scandinavia to California (e.g. WOW air).
  • Consumers are booking online and not through traditional tour operators.
  • Scandinavia is the fourth largest European market to the United States.

AUDIENCE

  • Scandinavians enjoy five to six weeks’ vacation plus 12 paid holidays annually.
  • Scandinavians voted U.S. the top long-haul destination in 2017 for the seventh consecutive year.
  • Scandinavian travelers seek authentic, unique experiences (authenticity = luxury).

PRODUCT EXPERIENCE

  • Fly/drive itineraries are dominant in tour operator offerings, and customized itineraries are very popular.

 


Sources

  • Nordic Outlook October 2017
  • Danske Bank
  • International Monetary Fund
  • Global Finance Magazine
  • Finnair
  • SAS
  • Norwegian
  • DIIO
  • U.S. Department of Commerce
  • Nordic Market Report
  • PATA
  • Tourism Economics
  • National Travel and Tourism Office
  • WOW air
  • Danish Travel Awards