Zoom on Italian tourism is good, but could be even better

As we’ve seen at the BIT 2020 - Travel Exhibition Milan, despite solid performance in recent years, the entire sector has to rise to the challenges of sustainability, accessibility, and technological innovation, without neglecting the need to deconcentrate seasonality.

The context

Looking at Italian tourism through a lens of opportunities, challenges and ambitions, what immediately catches our eye is certain distinctive characteristics marking the evolution of this sector in recent years. Thanks to new itineraries and travel motivations, our country is more and more attractive to foreigners and emerging markets, and exceptional performance shows that the Italy brand satisfies these new trends in demand. In fact, foreign tourists outnumbered domestic tourists (at 50.5% of the total), with 217 million nights spent in Italy and total spending of 42 billion euro. In 2019, growth over the year before stood at around 7%, according to value data. What’s more, Italy has surpassed France in the number of visitors coming from extra-European countries, ranking first in world destinations for luxury travel; Italy also enjoys top billing with millennials, families and honeymooners.

Wine and food tourism has had explosive growth over the past two years. But as far as type of vacation, cultural tourism still represents the biggest segment with the biggest spending, with greater growth in small towns and in minor art cities. This statistic is easily explained if we consider that 5570 Italian villages are home to 64% of Italy’s 55 UNESCO World Heritage Sites. These villages (which have a population of less than 5,000) have 56,000 establishments offering tourist accommodation for a total of 1.4 million beds, which equates to 27% of the total for national tourism.

Some traditional segments, such as mountain holidays and seaside destinations (for decades a driver of growth in Italian tourism), are experiencing a downturn in certain areas, but in others are getting a ‘new lease on life’. This thanks to events showcasing sports, wine and food tasting, and personal wellness that can meet the wide range of needs of today’s tourist. (Just think of the Romagna Riviera on the Adriatic Coast, which is always pioneering new products, or areas in Veneto or Southern Italy, with Puglia leading the way.)

So a new conception of ‘holiday’ is giving Italian tourism a boost. The choice of destination is dictated by personal motivations and the quality of the destinations, but more and more often, tying into these considerations is the desire for self-realization, the need to have unique experiences, the search for authenticity, the appeal of coming into contact with a world – present and past - that is completely different from one’s own. For all these reasons, Italy has recorded remarkable growth in spending on tourism that responds to these needs.

Taking a closer look at supply, with nearly 33,000 tourist accommodation establishments and 1,100,000 rooms, Italy takes first place as far as number of hotels in Europe, and fourth place in the world, behind the US, China, and Japan, with a global market share of 5.6%.

eaving aside the hotel/non-hotel categorization, which implies ad hoc management policies and regulations, in recent years there has been a progressive an upgrade in the supply of tourist accommodation, consisting of both remodeling old structures and building new ones. Along with the rapid development of hotel chains, for the most part outside of Italy, a process of requalification is also underway. This involves smaller, independent structures, which reflect the unique characteristics of the local area and offer service with a ‘human touch’. Big players, instead, concentrate mainly on three types of investment: high-end, iconic hotels; recouping and reinterpreting the historical heritage with an accent on hospitality (historic homes, churches, convents); and the rebirth of resorts both in leisure destinations and near urban centers. More and more often, new establishments are being built with an eye to design, in harmony with the surrounding territory and in keeping with the distinctive traits of ‘Italianness’ (to include restaurants with Michelin-starred chefs). All these factors enhance the domestic competitive advantage.

Finally, we can note an impressive sign of growth in the hotel sector, both in investments (which have doubled over the past five years), and the number of transactions undertaken by professional investors, such as funds or institutional investors. Big cities continue to represent the primary ‘piazzas’ for these investments, even though over a third target exclusively leisure destinations. What’s more, over half of these investments come from outside of Italy, and 25% outside of Europe

In conclusion, despite this positive evolution in the sector, the Italian tourism industry still has a long way to go. The key words for the near future is: growing demand for sustainability, reinforcing accessibility and technological innovation, but without neglecting the need to deconcentrate seasonality, redistributing tourist flows throughout the year. Environmental sustainability needs to be applied to the entire range of tourist offerings, both in terms of demand for all products, as well as premium price options. Accessibility has to do with developing a network of transportation and services, in addition to intermodality to reach more remote destinations. Innovation comes into play in terms of tools for efficient tourism management, in facilitating communications and sharing, but also for promoting the ‘country system’ with the help of information provided by big data.

By promoting Italy and shoring up this country’s competitive position (as a world tourism destination), notable benefits can materialize, but only if these efforts are introduced into the broader context of the ‘country system’ and the concept of Made in Italy. We need to move away from increasingly sterile parochialism, finally with the support of shared, uniform policies.

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