Industry Performance
GOLD STARS FOR ALL
VOV 2023 reports that visitation was up 28% in 2022 over 2021. Visitation remains 7% lower than in 2019, but there’s plenty of reason for optimism and opportunity.
Good news surrounds the industry. The Cruise Lines International Association recently said that demand and perception of cruise holidays exceeded 2019 levels. Celebrity Cruises, Holland America Line, Royal Caribbean International, and Seabourn reported breaking booking records in November 2022.
Jeff Shell, NBC Universal CFO, echoed similar optimism about theme parks during NBC Universal’s Q3 earnings call, reporting record theme park earnings. He said, “Despite the economic uncertainty that you see elsewhere in the economy, we’re seeing no effects of that right now in the theme parks, either in terms of our performance or our bookings going forward.”
In the hotel sector, STR and Tourism Economics predicts an average 2023 U.S. daily room rate of $151; companies now project 2023 revenue per available room to reach $96, up 11.6% from 2019 levels. During Hyatt Hotels Q3 earnings call, Mark Hoplamazian, Hyatt President and CEO said, “It’s clear that people are prioritizing experiences and connection as we see in the upcoming festive season where our resorts are pacing 30% ahead of 2019, or the amount of group business being booked into 2023 at our Americas full-service managed properties, which is 30% higher than 2019 levels.”
Where were people looking to connect in 2022? Historic landmarks, national and state parks, zoo/animal attractions, and theme park/amusement parks topped the list. Most categories saw an increase in visitors from 2021 reports, with slight declines in categories including natural wonders and large-format screen theaters.
VOV also tracks unconverted intent, quantifying pent-up consumer demand—or a measurement of consumer intent relative to actual incidence of visitation. The level of unconverted intent remains high at 57%. It’s beginning to level out but has not reached 2019 levels yet.
Jerry Henry, CEO of H2R Market Research, explains further, “Consumer intent nearly always exceeds actual behavior. It is only a matter of by how much intent exceeds incidence. Historically, attraction visitor intent has exceeded incidence of visitation by 51%. That is normal.
In 2020, that figure surged to a record 65% because people wanted to visit but were unable because of COVID-19. Thus, intent remained strong while actual incidence was comparatively low. In 2021, aggregate attractions industry unconverted intent slipped to 62%, and in 2022 fell back to 57%. But while this is a bit lower, 57% remains well above the historical norm of 51%. Why? I believe it is because the heart wants what the heart wants. A significant desire remains to visit attractions, travel for leisure, and engage in new experiences. And while incidence of visitation has increased significantly since 2020, intent to visit continues to surge as well. Therefore, unconverted intent or pent-up demand remains comparatively high relative to the historical norm.”
Repeat visitors in VOV 2023 reported spending 25% more this year than they did on their previous visits. A survey by the International Show Caves Association and National Caves Association USA showed that direct spending at show caves was up 7% globally.
Brad Wuest, President and CEO of Natural Bridge Caverns in San Antonio, Texas, said, “We’ve seen a 3% increase in attendance, but spending is up 35% across the board since 2019. We’ve been focused on providing an exceptional experience for our guests while maximizing visitor spending. Our dynamic pricing model helps us keep our admissions pricing in tune with demand. And our guests are choosing to stay on property longer and spend more on attractions, retail, food, and beverage. Another factor of our success has been a focus on taking care of our team with competitive wages, benefits, and an enjoyable culture and work environment. This has allowed us to be fully staffed, which helps us maximize visitor spending by providing excellent customer service and having all revenue centers fully operational.”
The summer provided increases in spending at theme parks, with quarterly reports from Disney, Universal, SeaWorld, Six Flags, and Cedar Fair all reporting increased visitor spending.
© Wellbeing Brewing
Let’s toast the promise of 2023 with a citrus-flavored non-alcoholic craft brew!
PGAV’s recent Food, Beverage, and Retail study showed that visitors want alcohol as an option. And that might be the key: an option. As interest in wellness trends grows, there’s a rising tide of people interested in non-alcoholic beverages. According to NielsenIQ, non-alcoholic beverage sales grew 20% from August 2021 to August 2022. Sales of non-alcoholic beer, wine, and spirits all grew significantly.
Jeff Stevens, the founder of WellBeing Brewing, noticed the gap of non-alcoholic beers in the craft brew industry years ago. He wanted to find a way to make non-alcoholic beer taste good and hold its own against craft beers. WellBeing invested in technology that takes fully fermented beer but removes the alcohol. Stevens says this, “leaves the aroma, mouthfeel, body, and flavor—everything you love about craft beer.”
Stevens adds that consumers have responded positively, commenting that “non-alcoholic options give people comfort in social situations. People don’t miss moments.”
WellBeing is looking to innovate flavor profiles. “We look forward to mirroring craft beer’s propensity to use an infinite number of ingredients to make non-alcoholic options, including electrolytes, mushroom and fungus, and CBD,” Stevens says.
Flavorman’s 2023 Beverage Trend report predicts consumers will seek more natural ingredients and a health-conscious focus, with ingredients like ginseng root and plant-based formulas. The report also shows a shift toward citrus flavors like orange, grapefruit, and lime, as well as berry.
On the food side, consumers are increasingly looking for sustainable options. Interest in plant-based eating continues to grow. Spaghetti squash pasta? Yes, please! The National Restaurant Association's What’s Hot 2023 Culinary Forecast sees a focus on Southeast Asian flavors, healthier options, and an interest in adding to “culinary passports.”
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