Tourism accounts for 15% of Spain’s GDP. It is a sector that employs many people and has a lot of weight. Therefore, we must work to make this summer campaign as less disastrous as possible
In pre-pandemic times, Spain was a global engine of tourism. In 2019 it received 83.7 million visitors, thus achieving, for the seventh consecutive year, its historical record in international tourist arrivals. But then came the coronavirus pandemic and with it the fear of travel and the fear of tourism. Spain wants this campaign not to be as disastrous as it looks and that is why Spaniards are being asked to travel around their country. But will it be necessary to continue betting on low-cost tourism or change the strategy to a luxury one?
Pedro Aznar, professor of economics at Esade, believes that the important thing is not how many tourists come, but how much activity they do: “Two luxury tourists benefit you more than 60 in a hostel. For his part, Álex Alegret, professor at EAE Business School, points out that a distinction must be made between low-cost tourism for a lower-middle income family and low-cost tourism for drunkenness. “The first option is very welcome,” he says. And as he explains, it benefits us that they come “because the infrastructure is already in place”. He also points out that they consume locally.
Alegret assures that the most affected towns want to get away from this drunken tourism, “it is not very profitable, even if it allows you to fill up an infrastructure, but you can neither modernize nor increase average prices, nor have a considerable margin”. For this reason, he insists that a hotel prefers a family that comes and consumes drinks, ice cream, potatoes… “in addition, at 11pm it allows you to be calm, with everything closed, while the other tourism, the one of drunkenness, they destroy your room, they jump out the window, they are people that are not going to consume that are going to fill your room with food, with drink… it does not allow you to reinvest”.
We must remember that tourism is the sector that drove job creation after the crisis in 2008, and if it is not reactivated, the impact will be very important on a national scale, since it represents 15% of the GDP, but in some areas its weight can reach 40%. Also in relation to the previous recession, the Esade professor explained that when it began “there was a liquidity crisis, but now the problem is one of solvency and profitability”.
Aznar considers that Spain also attracts luxury tourism “and this has a very different dynamic”. Although Alegret assures that Spain can not only live from luxury tourism because it is not like Iceland, “we have a tourism of sun and beach, of vacations”. He adds that there is luxury tourism, but with the country’s infrastructure it would not be profitable to have only luxury tourism. The professor of EAE Business School explains that the tourist this year to come to Spain will be circumstantial, “but only this year, not next year, because people will want to continue going on vacation.
How is the luxury tourist?
From Círculo Fortuny, they point out that before this whole crisis began they closed the year 2019 with a greater increase in income than in the number of arrivals. “This was a data that could mean the beginning of a change of trend towards a higher quality tourism”, they explain. However, the health crisis left these perspectives in suspense and there is still much uncertainty as to how it will affect the medium and long term. This year it seems clear that the little tourism that will be received will be of proximity and more focused on the traditional Spanish offer of sun and beach, “especially because many non-EU markets, which are the largest expenditure in destination, as the Americans still can not come.
Therefore, Círculo Fortuny believes that what will arrive first is most likely a low cost tourism, attracted by the fall in prices in the sector and taken over by tourists from nearby markets such as the United Kingdom or Germany. That is why they point out that Spain will have to rebuild the foundations to attract this type of traveler, which is increasingly focused on the experience rather than on purchases, according to the True-Luxury Global Consumer Insights study, conducted by Altagamma, which also highlights that due to the health crisis more than half of luxury consumers (57%) prefer to refrain from making purchases and planned trips, rising to 65% in the case of a market as important for luxury tourism as China.
According to the same study, 60% of luxury tourists say they cannot wait to take a trip, but Spain is not among their preferred destinations, since Italy and France are the countries that occupy that place. In addition, before the pandemic, luxury tourists spent 50% less in cities like Madrid or Barcelona than in other European cities like London, Paris or Milan, according to data from Global Blue, “which makes it even more difficult to be confident that after the health crisis, luxury tourism will be the majority.
For all this, “it is time to start creating the tourism industry of the immediate future, which is what will really make us take a leap in quality and enter the First Division of World Tourism, going from quantity to quality,” said from Círculo Fortuny. From URSO Hotel & Spa they explain that the luxury tourist is “the client who expects us to exceed his expectations, whether with the service, the product or the atmosphere we create around him individually or as a group”.
Examples can range from a client who came for a treatment at the SPA and leaves with the entire product range and a voucher reserved for his next appointments, “or a reservation at our restaurant and ends up booking a Suites with a terrace for exclusive dining by choosing from our more than 650 wine references or after requesting a corporate event, they finally make a gala dinner”.
Author: Marta Garcia, Byzness