SHOPPING TOURISM MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

The global shopping tourism market is facing significant restraints in its growth trajectory owing to the widespread economic uncertainty and rising inflation plaguing many economies worldwide. As international travel has resumed post pandemic lockdowns, consumers are growing increasingly cautious in their discretionary spending habits. The conflict in Ukraine and rising energy prices have further exacerbated pre-existing inflationary pressures globally. According to data from the World Bank, consumer price inflation rose to a 40-year high of 8.3% in advanced economies and 9.8% in emerging markets in 2022, reducing consumers' real spending power.  Higher costs of living are leaving tourists with diminished budgets to spend on luxury and experiential purchases while traveling. Hefty price increases across all categories from retail goods to international airfares and accommodation are also diminishing the appeal of shopping tourism. Moreover, the uncertain geopolitical environment and risk of recession in major economies have made consumers more cautious about making big ticket purchases. Uncertainty around jobs, incomes and the wider economic outlook have turned shoppers away from non-essential spending. Weaker consumer confidence as a result of high inflation and gloomy economic projections are expected to continue restraining the global shopping tourism industry's growth over the short to medium term. Tourists are prioritizing essential travel and experiences over dedicated shopping trips till macroeconomic conditions stabilize. This will limit opportunities for destinations banking on tourism revenues to revive fully.

Opportunities: Emerging Markets in Asia Pacific and Middle East & Africa

The emerging markets in Asia Pacific and Middle East & Africa regions provide tremendous opportunities to drive growth in the global shopping tourism market going forward. These regions are seeing significant economic and social development which is translating to a burgeoning middle class with higher disposable incomes. International travel from these markets has been on a steady rise according to United Nations World Tourism Organization data. Countries like China, India, Indonesia, Saudi Arabia, United Arab Emirates, etc. have shown strong outbound travel growth from 2014-2019, exceeding global averages. This presents a huge customer base for shopping tourism. As incomes rise, so does the aspiration to travel overseas and make prestigious purchases. Major destinations around the world are ramping up their appeal to these emerging market travelers with targeted visa policies, luxury retail showcasing local crafts and culture, multi-lingual promotions etc. Shopping centers in these regions are also dedicating more space to high-end brands. For instance, Dubai attracts over 20 million visitors annually through its duty-free ports attracting Chinese and Indian customers. Likewise, Bali is working towards becoming a preferred luxury shopping hub in Southeast Asia leveraging its cultural heritage.