Prospects for the coming summer season 2016 – Russia

07.06.2016

The overall outlook of travelling to Finland for the coming summer season

  • Most of the companies estimate a decrease, though there are few tour operators in Saint Petersburg who have reported relatively good sales for the upcoming summer season.
  • Main reasons for the decrease are still the same: high EU/RUR exchange rates, challenging procedure of applying for a Schengen visa (in comparison to previous) that prevents regional clients from travelling and makes them choosing destinations where they can go to without visas; challenging economic situation = low disposable income and decreasing travel budgets of the majority of clients
  • One of the most popular products of the latest years – a weekend in Finland with some sightseeing, shopping and staying in a middle class spa hotel – is not so popular as earlier as the price is quite high. Some tour operators report that longer-term trips to Europe and for example trips to Norway fiords are still popular, though the price is higher – the reason is that people are ready to invest more in a complete, proper trip where they go to on holidays, but not ready to spend too much money for one weekend. Several Moscow TO say 3-5 day cruise vacations aboard by Princess Anastasia ferry (offered by St. Peter Line) are quite popular nowadays among Russian families since it is cheaper than touring by land. Many tourists take an active interest in special promotions and discounts. Nevertheless, there’re still expensive requests when accommodation costs are not important and the client wants to visit the ‘coolest’ places.

Long term trends

What do you see as main tourisms trends in your market area?

Russian outbound tourism market depends to a great extent on the exchange rate of the national currency. As reported by the CEO of Association of Russian Tour operators, the number of travel companies selling outbound tours is shrinking and may decrease twice by the end of 2016. At the moment there are 684 companies in the country that are selling international travelling. Given the situation, the TOs expand their portfolio by adding new destinations (the current job positions illustrate well this trend: Manager of Indochina, Thailand, East Afriсa, Montenegro, Finland, Sweden dept. or Head of Italian, South America, Scandinavian, Finland dept.). Experts and TOs estimate that the outbound travelling volumes will go down 15-30 %.

  • Increase of internal travelling next 2-3 years. Travelling to Sochi and Crimea is estimated to increase app. 30 % in summer 2016, and the total number of internal Russian tourists will be 3-5 million.
  • However, some of our Russian partners think the quality of local travel service provides being quite low and prices being too high. They believe that Russian people will soon be disappointed with internal travelling and start going abroad again.
  • People from Northern regions will prefer travelling to the South, a so called beach holiday: wellbeing travelling usually means the sea and the sun.
  • Travelling to non-visa destinations
  • Travelling abroad for vacations will continue, travelling for weekends go down
  • Last-minute booking increases
  • Cost-effective booking in advance (up to 6 months before the trip)
  • Russian travel industry has suffered a lot after it has been forced to stop arranging trips to Turkey and Egypt – according to experts, up to 60% of all Russian tourists went to these destinations. Now local travel agencies are selling Italy, Greece, Israel and Cyprus instead of the above mentioned. Israel and Cyprus are especially popular as Russians do not need a visa to travel there; Italy has 24 visa centers in Russia.
  • After a series of bankruptcies in travel industry Russian clients have become more careful when choosing a travel agent, so a good brand and references are very important

How should Finnish travel industry companies utilize these each of these trends?

  • Product development – flexible and competitive prices are the most important factor. It is essential for TOs that Finnish partners promptly deals with their requests, especially in case of last minute booking when tourist needs information on the same day, otherwise he/she will apply to another agency or change his/her mind and go to another country.
  • Marketing: stress on safety, relax, high quality which is not available from other destinations. Increase marketing in those Russian cities where we have visa centers, not to concentrate mainly on St.Pete.
  • Sales channel co-operation – online promotion, travel industry portals, targeted marketing of selected products to selected target groups

 

Olga Makeeva & Renata Akzhigitova, Visit Finland