Asia-Pacific (APAC) is the most populous region in the world, and with its rapidly developing sub-markets, it’s also becoming the world’s biggest opportunity for travel.

The standard of living in the developing countries of APAC continues to increase, and with almost two-thirds of the world’s population, this market is primed for huge growth in years to come.

Leading the charge are China, Japan, and South Korea, and the growth exhibited in these key markets will be mirrored by the rest of the region in step with increases in leisure time and wealth across the developing population.

Ad Spend Growth

No matter where you look, all sources point to growing ad spend levels for travel in the APAC region. Here are some key stats that highlight this growth:

• From 2016 to 2017, online travel sales in APAC increased by more than 22%, reaching $214 billion.

• The Global Ad Spend Forecasts report states that Asia-Pacific will generate 4.5 percent growth in 2019.

• By 2020, the APAC region will account for 40% in total online travel sales globally, far surpassing North America (27.6%) and Western Europe (20.2%).

• The World Travel & Tourism Council expects India to become the fourth-largest travel and tourism economy right after China, the United States, and Germany by 2028; it is currently ranked seventh in the world.

Source: eMarketer, 2018 / Strategy Analytics, 2016

A Technology-first Market

Global and western players have an increasing appetite to tap into the APAC travel market, due to its sheer size and growth rate for year-over-year advertising spend. From a digital perspective, APAC is pretty mature in its own unique way. Travelers in the region are extremely tech-savvy with the highest adoption rate of mobile applications compared to the US and EMEA.

APAC travelers prefer apps over mobile sites and desktop experiences. Therefore, APAC can be the right place to be for scalable tech-based players with a firm grasp on mobile integration and a focus on technology initiatives.

Before diving into digital strategy planning for the APAC market, global and western marketers need to approach the region through a new lens, due to its diversity as a region. Even though APAC is generally considered one single region, there are, in fact, various sub-regions that require localization tailoring to their own cultural and political states. In short, a “one-size-fits-all” digital
strategy does not apply here.

For example, the metasearch giant, Google, cannot be accessed domestically in China, but it is widely accessible in Taiwan and Hong Kong, which share many cultural and consumer behavior similarities with China. This strongly limits Google Hotel Ads’ site traffic in APAC, giving its main global competitors, Trivago and TripAdvisor, a bigger piece of the pie.

Another challenge for marketers is strong competition from local APAC players, many of which are tech giants that have high market penetration and a deep understanding of their local consumers’ needs and behaviors.

Digital Travel Trends in APAC

APAC consumers are tech-forward and mobile-first. The developing markets within APAC are growing at a time when technology is the driving force across the travel industry.

Not only are consumers more comfortable with mobile experiences than traditional travel markets in North America and Europe, but they expect flexible and quick travel booking experiences that OTAs are known for. Since technology and the travel industry are growing up together previously established technology companies play a big role in the entire travel journey planning process.

Reliance on Mobile Devices

The mobile-only world is quickly approaching in the travel industry. In terms of mobile booking rates for hotels, Asia is far ahead of
the rest of the world, and China is leading the pack with 60% of its online bookings made on a smartphone. North America and Europe stand at just 28% and 33%, respectively.

• Smartphone penetration: By 2020, eight out of ten households in developed markets and two out of three households in developing markets will be equipped with a smartphone.

• Mobile travel sales: Mobile travel sales already accounted for half of the total travel sales in 2017. Developed nations like Singapore and South Korea account for an even bigger percentage of online travel sales.

• App usage: In developing markets like India, travel apps are used throughout the travel planning journey, with 57% of consumers using them during the inspiration stage, 48% using them during the research stage, and approximately 70% using them to book trips.

Read the full report here