Silver tourism and growth opportunities in the U.S. travel market

¶ … Silver Tourism and its Future in the U.S.A.

Travel Market General Situation

Travel Market Segments

Current Situation of the Silver Travel Segment

Silver Tourism Future Trends

The Mature Traveler segment is the most stable and probably the most important travel market segment, with tremendous growth opportunities that will be discussed in the following pages.

The following pages focus on gathering information that characterizes the travel market of the United States in general, and the silver tourism segment in particular. The retrieved information will also be analyzed, in order to provide a clear image of the mature travel segment in the United States. For this research project, secondary sources were used, especially government sources, given the accuracy of data provided by such sources.

The paper starts by presenting and explaining the methodology behind this research project. Given the fact that secondary sources were used for gathering data on the subject, this fact will be explained in the Methodology section.

The paper continues with the Findings and Discussion section. In this case, the Findings section and the Discussion section were combined, in order to make it easier for the writer to present the results found and to discuss them, and for the reader to get a more clear idea on the presented facts. This section begins with providing an overview on the United States' travel and tourism general situation. This will provide the framework required for studying the mature travel market that follows. The following section discusses the most important characteristics of the mature segment and of its subdivisions. This section is followed by another, discussing future trends on the subject.

The paper ends with the Conclusions section. This section generally presents the findings discussed in the above mentioned sections. All the sources consulted for gathering the information for this research project are listed in the Reference List

1. Methodology

In the case of a research project, even when it is necessary to collect primary information, the first step of the research must consist in consulting the most adequate secondary sources. In our situation, secondary sources will ensure most of the information presented in the following section.

For this research project, the most useful secondary sources have been identified, on the one hand, and they have been evaluated in accordance with the requirements of the researched situation. For this market research secondary sources have been consulted, as an essential condition, given the fact that such sources present the highest degree of accessibility and they ensure a more thorough image on the tourism market in the U.S.A. In general, and of the silver tourism market in particular.

In this research on silver tourism market, secondary information contributed to increasing the degree of understanding the problem in cause, elaborating research hypotheses, identifying a suitable research method and the nature of the data that must be obtained, and establishing an adequate interpretation of the information.

2. Findings and Discussion

2.2. U.S. Travel Market Segments

As revealed above, the travel market in the United States is following an ascending direction, expanding its volume and diversifying its offers. Every segment of the travel market is registering increasing values. Also, each of the travel market's segments show serious signs that this development will continue in the future period of time. The following section will focus on describing each important segment of the travel market.

The African-American travel segment has increased by 4%, from 72.2 million to 75.2 million person-trips. This segment has registered the most important increase, compared to other segments. In this market segment, the structure of person-trips is the following: leisure 74%, visiting friends or relatives 44%, business 22%. Favorite destinations include: Florida, North Carolina, Georgia, Virginia, and Texas.

The Asian-American travel segment has registered an even more significant increase, of 10%, from 30 million to 33.1 million person-trips. The travel structure was the following: leisure 77%, visiting friends and relatives 40%, entertainment 18%, outdoor recreation 8%, business travel 21%. Another relevant fact regarding this segment is the fact that it is more likely to include shopping activity, compared to other segments.

One of the travel market segments that are decreasing is the business travel segment, which has decreased 2%, reaching 210.5 million person-trips. The favorite outdoor vacation activity consists in camping. Most of the travelers that visit the United States come from Canada and Mexico.

2.3. Current Situation of the Silver Travel Segment

The travel market can be divided into several segments in terms of several factors. The age factor reveals 11 life stage segments, by relating life stages with different generations that stand out. These segments are: Generation X or Generation Y (Young), Baby Boomers (Middle), Empty Nesters and Seniors (Older). The largest segment is the Middle Parent households that account for 23% of shares.

However, the segment that will be analyzed in the following pages is consisted of the mature segment. Mature household trips, this including people over 55 years of age, last the longest, compared to other travel segments: the average is 4.8 nights, and 16% last seven or more nights on their trips (TIA, 2006).

In addition to this, this segment accounts for a higher share of day trips, reaching 26% of the total of trips. This situation establishes the mature traveler segments as number one compared to other age segments, with 3.5 nights average trip durations.

The hotel, motel, or B & B. are the most preferred accommodations, reaching 53% of travelers, while 41% of them choose their friends' or relatives' homes for staying during their trip. Another fact revealed by several research projects is that "mature household trips are the most likely of all generation groups to be generated by multiple adults traveling without children" (TIA, 2006). Given the fact that this segment is continually registering increases in number and volume and the fact that the financial power and availability of time are quite high, it makes of this segment a very attractive opportunity with continuous growth and development possibilities.

The mature travel segment itself is subdivided into two other segments: Junior Matures aged 55 to 64, and Senior Matures aged 65 and older. Nowadays travel industry is influenced by a very important demographic trend: the aging of the U.S. population. Even more, this factor is correlated with another: in 2001, the first members of the Baby Boom generation, reaching 78 million, turned 55 years of age, entering the mature travel segment. This will lead to a tremendous increase in the number of people belonging to this segment, which will require more attention from travel businesses.

Regarding financial power, the mature segment has a very strong, healthy, and sustained position. Furthermore, the mature traveler group presents the highest net worth of all age groups. The stability of their income is also due to the fact that they do not have to support the cost of setting up a household or of raising children. In addition to this, this segment has the lowest consumer debt compared to all the other segments. The availability of their income goes hand in hand with the availability of their time, which allows them to have more leisure time that can be used for traveling than other segments of the travel market (TIA, 2000).

In the past 15 years, the mature segment of the travel market in the United States was not characterized by significant changes in trends. The fact that the majority of trips taken by mature travelers consist in pleasure trips by auto has not changed since 1994, comes to support this statement. The lodging habits of mature traveler are also quite constant. Therefore, 50% of mature travelers lodge themselves in hotels, motels, or bed and breakfast establishments, while 40% of them opt for the homes of the friends or relatives they are visiting. Obviously, this aspect is related to the purpose and possibilities of the respective trip.

However, this market segment is characterized by significant changes regarding the demographic profile. Therefore, one may notice increases in the number of trips taken by mature travelers with a college degree and with an annual income of $75,000 or more. Nowadays mature travelers are more technologically oriented than they were a decade ago.

Currently, mature travelers account for approximately 31% of all domestic trips, the largest share that any of the travel market's segments have. Also, trips taken by mature travelers are the most likely to be for pleasure and to include a car or track as a mean of transportation.

Regarding the length of mature traveler trips, they are less likely to involve overnight stay. However, in case such a situation occurs, the average length for a trip is a day longer than trips taken by other segments of travelers. As mentioned above, most of the longest lasting trips are taken by mature travelers. Mature travelers spend more on their trips, given the fact that approximately half of them lodge themselves in hotels, motels, or bed and breakfast establishments, rather than lodging to the houses of friends or relatives.

The favorite trip activity for mature travelers is shopping. This activity is preferred by 30% of mature travelers. Aside from this activity, mature travelers are oriented towards visiting historical places or museums, attending cultural events and festivals, gambling, and outdoor activities.

However, there are slight dissimilarities between the two subdivisions of the mature travelers segment: Junior matures and Senior matures. Junior matures account for 15% of the total of U.S. domestic trips, reaching a number of 86.2 million. Senior matures account for 16% of the total of U.S. domestic trips, reaching a number of 92.6 million.

Senior matures travelers' trips are more likely to be directed towards pleasure purposes, because they are retired and have more leisure time to spend. Most of Junior matures travelers are still employed, which means their trips are more likely to be oriented towards business purposes, and are more likely to be by air, and to include a rental car as a supplementary mode of transportation.

The average trip spending by Junior matures is higher than that of Senior matures. Also, Junior matures are more likely to include shopping, outdoor activities, nightlife activities, and visits to theme or amusement parks in their trips. Instead, Senior matures are more likely to include visits to historical place or museums, attending cultural events and festivals, and group tours in their trips.

2.4. Silver Tourism Future Trends

It is expected that the mature traveler segment of the U.S. travel market will continue to expand in all directions. As a consequence, the volume registered by this segment will continue to increase, and so will the number of trips.

These future estimated increases are due to the fact that more and more Baby Boomers now turn 55 or more, which qualifies them as mature travelers. This means that there will be an infusion of silver consumers, in all economic areas, especially regarding tourism and travel activities.

However, it seems that marketers did not take into consideration this market segment as seriously as they should have, since "as boomer gallop through their 60th birthdays with hardly a backward glance, the market simply has not spent enough effort in meeting or even imagining the wants and needs of those already in their 60s, 70s, and beyond-while the ranks of these mature adults are swelling into unheard-of numbers" (Report Buyer, 2007).

Conclusions

United States' travel market is continually expanding, significantly increasing its volume. Certain travel market segments experience important increases, while other segments are stagnating or decreasing.

One of the most important travel market segments is the mature segment, comprising individuals over 55 years of age. This is the most stable of all segments discussed in the previous pages. Even more, it presents serious opportunities for expansion and development.

The mature segment is characterized by great financial stability. Also, this segment presents the highest availability of time, which, combined with the financial availability, make of mature travelers the most stable and probably the most important segment of the travel market. It is recommended to take advantage of the growth opportunities presented by this segment in the current and future periods of time.

Reference List

U.S. Travel Market Overview - Demographics (2005). Travel Industry Association. Retrieved March 14, 2008 at http://www.tia.org/researchpubs/us_overview_demographics.html.

Marketing Research Programs - Travel Market Segments (2006). Travel Industry Association. Retrieved March 15, 2008 at http://www.tia.org/researchpubs/travel_market_segments.html.

The Mature Traveler (2000). Travel Industry Association. Retrieved March 15, 2008 at http://www.tia.org/researchpubs/executive_summaries_mature_traveler.html.

Mature Market in the U.S. Summary (2007). Report Buyer. Retrieved March 15, 2008 at http://www.reportbuyer.com/consumer_goods_retail/demographics/mature_market_u_s.html.