Skyrocketing demand for travel will lead to a “scarcity of place” and could result in higher prices and rationing, two business economists argue in a recent edition of the Harvard Business Review.
If current forecasts by the United Nations World Tourism Organization are correct, international tourists visits will go from 800 million this year to 1.8 billion by 2020. This will create new challenges, including waiting lists to visit sites and cities and soaring costs, say Paul F. Nunes and Mark Spelman, both with the Boston-based Accenture Institute for High Performance Business.
The authors also see it increasingly difficult for businesses to co-exist and compete in cities with a massive influx of tourists. They also believe “jaw-dropping prices and decades-long waiting lists will prompt the creation and expansion of destinations in both developed and developing countries.” China’s Macao is an example cited. Governments and institutions may also seek to control demand by imposing heavy surcharges on travel to the most popular places or by requiring costly visas for access, they argue.
“As the scarcity of places grow, many companies will find opportunities to profit by meeting new levels of demand for authentic—and inauthentic—experiences. However, they will also have to jockey for space in this increasingly crowded, mobile world.” They cite controls over ecologically sensitive areas such as the Galapagos Islands and Peru’s Manchu Pico.
“A billion or two additional international travelers represents both a massive potential headache and an opportunity go for business. Which it will be depends on what companies do now, before someone starts selling tickets to New York City.” For information, visit www.economist.com/journals or www.harvardbusinessreview.com.