Visa predicts explosion in global tourism: 50% more travelers by 2025

Visa estimates that the number of people making a cross-border trip will climb by 50% over the next 10 years, leaping from 2015’s total of 1.2 billion to 1.8 billion in 2025.

According to Visa chief economist of business and economic insights Wayne Best, three primary dynamics will drive this growth. The first is the sharp growth of the middle class in the developing world. Visa estimates that 280 million households will be traveling internationally by 2025, with emerging markets accounting for 45% of the $1.5 trillion in annual spending globally on cross-border travel.

It adds that with the cost of travel dropping due to increased competition and greater connectivity, nearly half of the world’s households will have enough income to be part of what it calls the global traveling class by 2025.

Secondly, the aging of the world’s population will fuel travel in the next decade as people in their golden years take longer and more expensive trips than their younger counterparts and data shows that they continue to travel until well into their 70s.

Finally, growing worldwide connectivity, both in a physical sense and a technological one will make travel faster and more convenient. Aircraft are flying further and make nonstop service more common between remote destinations since airlines have added 2,500 nonstop routes since 2011.

Furthermore, digital tools such as GPS-enabled mobile devices make traveling and booking travel easier, more convenient and more spontaneous.New technological tools make far-flung locations seem more familiar and accessible, spurring interest in international travel.

Mapping the Future of Global Travel and Tourism

Visa notes in its study entitled “Mapping the Future of Global Travel and Tourism” that “more than fifty years ago, the burgeoning Jet Age introduced bigger, faster airplanes—which made travel more affordable than ever before and transformed international travel and tourism from a luxury requiring significant time and money to a leisure activity enjoyed by a much broader spectrum of society.”

The study also adds:

“Today, the promise of Jet Age travel is soaring to new heights. According to data from the UN World Tourism Organization, more than 1.2 billion people made an international trip in 2015— this is expected to increase 50 percent to more than 1.8 billion world travelers over the next 10 years.? International travel spending is also expected to surge.

By 2025, estimated crossborder travel around the globe will rise dramatically, with spending reaching nearly $1.5 trillion in 2015 dollars annually, according to a new Visa study. However, it is not just that more international travel and tourism is taking place than ever before, but also how it is unfolding. Three mega-trends are reshaping and accelerating the growth of travel and tourism:”

Rising global traveling class

Visa estimates that more than 280 million households will be traveling internationally by 2025. Growing income levels around the world are creating a new “traveling class.” Households making $20,000 USD or more per year account for 90 percent of spending on international travel and about four out of every five international travel arrivals today. By this calculation, nearly half of all households globally will belong to the traveling class by 2025.

Visa estimates travelers from nearly one in three of these traveling class households will take at least one international trip per year. Households in emerging markets will fuel the growth in global travel, representing nearly half of all traveling households by 2025.

Global aging

By 2025, travelers aged 65+ will more than double their international travel to 180 million trips, accounting for one in eight international trips globally. Older travelers can afford bigger trips and are more focused on comfort and health than saving money. Long-term, the aging traveler will transform travel and one area that is already growing in response is the so-called “medical tourism” industry as more travelers opt to combine medical treatments with vacation.

Increasing connectivity

The forces of globalization and technology are shrinking distances. Construction of more than 340 new airports is expected over the next decade, creating new routes and destinations that will make international travel easier and more convenient. At the same time, awareness of alternative modes of transportation, accommodations, destinations, cost and other travel options is spreading with the rapid uptake in Internet access and the number of mobile devices around the world. Digital connectivity is not only fostering greater spontaneity in travel, but also a broader array of personalized travel and tourism options as well.

Drawing on the power of the world’s most advanced processing network, Visa can help you better understand these and other global travel and tourism trends. With billions of transactions flowing through VisaNet every day, Visa sees roughly 25 cents of every U.S. retail dollar spent around the globe. Using these actual transactions as a starting point, Visa can employ sophisticated data analysis methods to monitor spending patterns across major purchase categories; provide a near real-time view into spending across regions, countries and major cities; and even insight into the number of cross-border visitors and key differences in their spending habits. Visa’s data is more comprehensive and timely than virtually any other source—capturing transactions that occur online and in physical stores, often well ahead of other industry stats.

This executive summary leverages VisaNet information to dig deeper into the three travel mega-trends highlighted in the study, which was conducted with Oxford Economics. The summary also provides a handful of concrete examples that show how Visa’s unique data and insights can help you stay ahead of the trends by providing a greater understanding of the growing travel and tourism industry.