Italy

Market Profile $0.5bn

Performance overview

total spend

In 2013, Italy was Australia’s 17th largest inbound market for visitor arrivals, Total spend from Italy in 2013 (up 15 per cent on 2012)3 the 17th largest market for total expenditure and 13th for visitor nights. It was the 11th largest market for total dispersed nights1 during 2013.

70,500

arrivals

Italian visitor arrivals in 2013 (up 10.5 per cent on 2012)4

5.5m

total nights

Aviation routes from Italy to Australia2

Italian visitor nights spent in Australia in 2013 (up 36 per cent on 2012)3

London

33%

Frankfurt Milan

Venice Rome

dispersed nights1

Italy

Doha

Percentage of total Italian visitor nights spent outside gateway cities in 2013 (down 3 per cent on 2012)3

Dubai Abu Dhabi

Hong Kong

Singapore

Australia ranks

14th

among all out of region outbound5 destinations for Italian travellers6

Visitor profile in 2013 38% repeat visitors3 64% of total arrivals are for leisure3 20-34 years largest demographic3 $6,967 average spend3 81 nights average stay3 Sep-Feb peak booking period

Consumer research For detailed research into how Italian consumers view Australia and what motivates them to visit the country, see www.tourism.australia.com/ statistics/fact-sheets

Jul-Aug and Dec peak travel period

1. Dispersed nights refer to nights spent outside gateway cities of Sydney, Melbourne, Brisbane and Perth. 2. Source: CAPA - Centre for Aviation, Official Airline Guide (OAG), and Tourism Australia analysis.

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Italy Market Profile 2014

3. International Visitor Survey (Tourism Research Australia). 4. Australian Bureau of Statistics, Overseas Arrivals & Departures. 5. Out of region travel from Italy excludes travel to Europe and North Africa. 6. Tourism Economics, Tourism Decision Metrics.

Italy

Market Performance Arrivals trends History of Visitors from Italy into Australia

History Historyofofvisitors visitors(000s) (000s) Italy Italy

8080

Source : Australian Bureau of of Statistics , Overseas Arrivals andand Departures Source : Australian Bureau Statistics , Overseas Arrivals Departures

International visitor arrivals (000s) International (000s) International visitor visitor arrivals arrivals (000s)

7070 6060 5050 4040 3030 2020

YE Dec 2013 YE Dec 2013

YE Sep 2012 YE Sep 2012

YE Dec 2011 YE Dec 2011

YE Dec 2010 YE Dec 2010

2008 2008

YE Dec 2009 YE Dec 2009

Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

2007 2007

YE Dec 2008 YE Dec 2008

2006 2006

YE Dec 2007 YE Dec 2007

2005 2005

YE Dec 2006 YE Dec 2006

2004 2004

YE Dec 2005 YE Dec 2005

2003 2003

YE Dec 2004 YE Dec 2004

2002 2002

YE Dec 2003 YE Dec 2003

2001 2001

YE Dec 2002 YE Dec 2002

2000 2000

YE Dec 2001 YE Dec 2001

- -

YE Dec 2000 YE Dec 2000

1010

2009 2009 2010 2010 2011 2011 2012 2012 2013 2013

History of Visitors from Italy by Purpose of Visit

International Internationalvisitors visitorsbybymain mainpurpose purposeofofvisit visit Italy Italy

International visitor arrivals (000s) International visitor visitor arrivals arrivals(000s) (000s)

80 80

Source : Australian Bureau of Statistics , Overseas Arrivals and Departures Source : Australian Bureau of Statistics , Overseas Arrivals and Departures

70 70

Holiday Holiday

60 60 VFR VFR

50 50

Business Business

40 40 30 30

Education Education

20 20 Employment Employment

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Italy Market Profile 2014

YE Dec 2013 YE Dec 2013

YE Sep 2012 YE Sep 2012

YE Dec 2011 YE Dec 2011

2009 2009

YE Dec 2010 YE Dec 2010

2008 2008

YE Dec 2009 YE Dec 2009

Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

2007 2007

YE Dec 2008 YE Dec 2008

2006 2006

YE Dec 2007 YE Dec 2007

2005 2005

YE Dec 2006 YE Dec 2006

2004 2004

YE Dec 2005 YE Dec 2005

2003 2003

YE Dec 2004 YE Dec 2004

2002 2002

YE Dec 2003 YE Dec 2003

2001 2001

YE Dec 2002 YE Dec 2002

2000 2000 YE Dec 2000 YE Dec 2000

-

YE Dec 2001 YE Dec 2001

10 10

2010 2011 2012 2013 2010 2011 2012 2013

Others Others

Total numbe

15,000 45 to 59 yrs 10,000 60 yrs & over 5,000

Italy -

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Market Performance Visitor Arrivals by Purpose of Visit for 2003-2013

Italy: Visitor Arrivals by Purpose of Visit 2003-2013 Source: Australian Bureau of Statistics, Overseas Arrivals and Departures

35,000

Holiday 30,000 Total number of visitors

Total number of visitors

Visiting friends or relatives 25,000 Business 20,000 Education 15,000 Employment 10,000 Others 5,000 2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

Visitor Arrivals by Age for 2003-2013

Italy: Visitor Arrivals by Age 2003-2013 Source: Australian Bureau of Statistics, Overseas Arrivals and Departures

30,000

Under 15 yrs

Total number of visitors Total number of visitors

25,000

15 to 29 yrs

20,000 30 to 44 yrs 15,000 45 to 59 yrs 10,000 60 yrs & over 5,000

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

Italy: Visitor Arrivals by Purpose of Visit 2003-2013 3

Italy Market Profile 2014 35,000

Source: Australian Bureau of Statistics, Overseas Arrivals and Departures

Holiday

Total S

100,000

60 yrs & over

50,000

-

Italy

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Market Performance Expenditure trends Italy: Visitor Visitor Spend by Purpose of Visit for 2003-2013

Spend by Purpose of Visit 2003-2013

Total Spend (A$ 000s)

Total Spend (A$ 000s)

Source: International Visitor Survey (Tourism Research Australia)

300,000

Holiday

250,000

Visiting friends and relatives

200,000

Business Education

150,000

Employment

100,000

Others 50,000 2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Source: International Visitor Survey (Tourism Research Australia)

Visitor Spend by Age for 2003-2013

Italy: Visitor Spend by Age 2003-2013 Source: International Visitor Survey (Tourism Research Australia)

250,000

15-29 yrs

Total Spend (A$ 000s)

Total Spend (A$ 000s)

200,000 30-44 yrs 150,000

45-59 yrs

100,000

60 yrs & over

50,000

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Source: International Visitor Survey (Tourism Research Australia)

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Italy Market Profile 2014

Italy: Visitor Spend by Purpose of Visit 2003-2013

2013

Italy

Market Performance Visitor profiles

Holiday

Spend per trip $7,461 Stay 58 nights Spend per night $129

Visiting Friends and Relatives

Spend per trip $3,758 Stay 37.6 nights Spend per night $100

Leisure

Spend per trip $6,394 Stay 52.1 nights Spend per night $123

Business

Spend per trip $5,284 Stay 21.6 nights Spend per night $245

International Visitor Survey (Tourism Research Australia). Note: Data refers to an average of 2009-2013

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Italy Market Profile 2014

Italy

Aviation Landscape >> The Italy-Australia route remains highly competitive with a number of airlines offering a range of different routes and airfares to all Australian capital cities. >> In 2013, overall airline capacity growth from Italy to Australia was limited as airlines continued to develop alliances or codeshare agreements on the route. Growth is expected to resume in 2014.

Aviation routes from Italy to Australia

London Frankfurt Milan

Venice Rome

Italy

Dubai

Doha

Abu Dhabi

>> Middle Eastern carriers continue to add capacity in partnership with their alliance and code share partners.

Hong Kong

Singapore

»» During the first year of the Qantas and Emirates alliance, the airlines have reported an increase in visitation to Australia’s regional cities with the majority of customers travelling to Australia from the United Kingdom, Middle East, Singapore, Germany and Italy. In February 2014 the partnership was extended to include Jetstar. Emirates temporarily increased capacity on its Rome-Dubai services by deploying the larger A380 aircraft during April 2014. »» T he Italian Government is expecting Etihad to make a decision about its investment in Alitalia (the Italian flag carrier) in 2014.7 »» V irgin Australia and Etihad Airways continue to cooperate in the Italian market. Virgin Australia has expressed interest in operating services between Italy and Australia. >> Airlines continue to open up new Australian destinations for European travellers, making it easier for Italian tourists to travel and disperse around Australia via hubs. For example Malaysia Airlines launched Kuala Lumpur-Darwin services and AirAsia X launched Kuala Lumpur-Adelaide services in November 2013.

30% 37%

6% 7% 8%

12%

Key airlines and share of passengers

Airline Emirates Qantas Airways Etihad Qatar Airways Singapore Airlines Other

2009 33% 22% 4% 0% 8% 33%

Table includes direct and indirect capacity Source: Department of Immigration and Border Protection

7. Source: CAPA- Centre for Aviation.

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Italy Market Profile 2014

2010 36% 17% 6% 2% 7% 32%

2011 37% 16% 5% 3% 8% 32%

2012 39% 13% 5% 3% 9% 31%

2013 37% 12% 8% 7% 6% 30%

Italy

Distribution The online environment plays a key role in Italy for destination selection and planning. Consumers under 30 years of age are increasingly using online channels for bookings, especially for flights. However, traditional operators remain the main booking channel for the leisure market and special interest travel such as honeymoons.

Distribution System Wholesalers/ Large Agents

Retail Agents

Commission Level: 12 to 18%

Commission Level: 9% to 3%

>> The majority produce brochures on Australia combined with New Zealand and Pacific Islands. These operators sell their products through travel agencies and most of them also own travel agency networks or have significant shares in these networks.

>> Retail agencies are very influential in Italy, managing much of the distribution.

>> The honeymoon segment is key for these operators, representing between 65 to 80 per cent of their total business to Australia. >> Consolidations and mergers are heavily impacting the biggest players in the market. Special Interest >> Special interest segments out of the Italian market include youth, honeymoon and luxury. Honeymoon is one of the main segments for special interest tour operators, which are particularly active in their marketing. >> It’s common that some travel agencies with a tour operator licence sell destinations upon request, buying directly from inbound tour operators (ITOs). >> The youth segment is performing very well, however the traffic is not directly driven by specialising operators. A number of operators selling language courses have registered good growth for Australia, whereas Working Holiday Visa Makers (WHVM) are often organising and booking directly online.

8. Source: Nielsen Netratings / Audiweb.

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Italy Market Profile 2014

>> There are about 10,000 travel agencies in Italy. They are spread throughout the market but over 70 per cent are concentrated in central and northern Italy. Travel agency networks represent about 80 per cent of total agencies. >> There are 90 main travel agency networks. Of these the top five are: »» Welcome Travel Group with 1,000 travel agencies »» Uvet ITN with 900 travel agencies »» Group Geo Travel Network with 1,600 travel agencies »» Open Travel Network with 658 travel agencies »» Gattinoni & G40 travel network with 650 travel agencies.

Online8 >> Over 65 per cent of Italian families (14.5 million) have a computer connected to the internet. >> Nearly 70 per cent of the connected families access the internet through a broadband connection. >> 15.9 million Italians access the internet through mobile phones and 2.4 million Italians access the internet through tablet devices. Aussie Specialists >> The Aussie Specialist Program (ASP) is the primary platform for Tourism Australia to train and develop retail agents to sell Australia. >> As at 28 April 2014, there were 588 qualified Aussie Specialist and 165 in training. Inbound Tour Operators >> Inbound tour operators (ITOs) form a key part of the distribution chain in Italy, linked with Italian wholesalers which run Australian programs.

Italy

Distribution Trends

Planning a visit to market

Seasonality

Distribution >> Young consumers, especially WHVM, are increasingly booking direct with airlines and product.

Top tips for sales calls >> Make sure you know the product and positioning of a tour operator before the meeting. Product managers expect your products to be relevant to their clientele.

>> The peak booking period for travel to Australia is September to February.

>> The Italian online travel agency (OTA) market remains somewhat fragmented, with global players maintaining a significant share. >> Tour operators are still key distributors for honeymoons, with online channels used mostly as a research tool. Planning and purchasing travel >> Italian consumers are searching for value deals, particularly via online channels. Internet transactions for travel continued to grow in Italy and increased in total travel sales share. >> Traditional retail agencies remain an important channel for long haul, complex destinations such as Australia. Retail agents also remain a vital source of information alongside travel guides for Italian consumers.

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Italy Market Profile 2014

>> An average sales call with a product manager should last between 45 to 60 minutes. >> The best time for sales calls is January to May and October to early December. >> The key market centres to visit are Turin, Milan and Rome but specialised operators are spread throughout the market. >> For more general information on sales calls and planning a visit to market, please see Tourism Australia’s Planning for Inbound Success ebook at www.tourism.australia.com/inboundsuccess

>> Italian consumers are slowly moving away from the traditional August to September holiday period. The most popular period for long haul travel however remains summer (July to August) and winter (December), with February to November (inclusive) the peak season for honeymooners.

Italy

Distribution Seasonality of visitors from Italy

Seasonality of visitors from Italy

12,000 10,000 8,000

2013 2012

6,000

2011 4,000

2010 2009

2,000 0 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

SourceSource : Overseas Arrivals & Departures, Australian : Overseas Arrivals & Departures, AustralianBureau Bureau of of Statistics Statistics

Key trade and consumer events Event

Location

Date

TTG Incontri

Rimini

9-11 October 2014

BIT

Milano

February 2015

European Product Workshop

TBC

April 2015

Corroboree Europe

TBC

April-May 2015

Australian Tourism Exchange (ATE)

Melbourne, Australia

21-25 June 2015

Where to find more information Tourism Australia’s activities in Italy are managed from its Frankfurt office and a representative office in Rome. For more information visit Tourism Australia’s corporate website at www.tourism.australia.com Australian State and Territory Tourism Organisations operating in Italy include Destination NSW, South Australian Tourism Commission, Tourism and Events Queensland, Tourism Victoria, and Tourism NT. Also see: Italy Country Brief published by the Department of Foreign Affairs and Trade at www.dfat.gov.au/geo For the latest arrivals statistics, visit: www.tourism.australia.com/statistics/arrivals For the latest International Visitor Survey statistics, visit: www.tourism.australia.com/statistics/international

Please note In March 2014, the Australian Bureau of Statistics (ABS) released revised estimates (covering the period from July 2004 to December 2013) for international visitor arrivals and departures in its Overseas Arrivals and Departures (OAD) publication. The changes reflect major revisions to the methodology for inputting missing traveller data, which led to substantial downward revisions for business travel and numerous markets. The International Visitor Survey (IVS) statistics incorporate the ABS changes to visitor arrival statistics from the March quarter 2005. Tourism Research Australia (TRA) advise that there is now a break in series for the IVS statistics from the March quarter 2005, and that previous editions of the IVS should be used with caution. For more information, please refer to the ABS and TRA websites, www.abs.gov.au and www.tra.gov.au.

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Italy Market Profile 2014