Finance

Nigeria’s travel, tourism industry to hit $2.95b revenue in 2023.

Projected revenue from Nigeria’s travel and tourism industry will reach $2.953 billion by the end of the year. This is expected to rise to $3.746 billion by 2027.

The projection is contained in a global travel industry database released by Statista.

The database indicates that revenue is expected to show a yearly growth rate: Cumulative Annual Growth Rate  (CAGR 2023-2027) of 6.13 per cent, resulting in a projected market volume of $3.746 billion by 2027.

The market’s largest segment is package holidays with a projected market volume of $1.239 billion in 2023.

In the hotels segment, the number of users is expected to amount to 17,450 kilometres  users by 2027.

User penetration is projected to be  10.5 per cent  in 2023 and is expected to hit 12.1 per cent  by 2027.

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The average revenue per user (ARPU) is expected to amount to $126.80.

In the travel and tourism market, 66 per cent of total revenue will be generated through online sales by 2027.

The global travel management solution market is estimated to grow by 10.86 per cent in the next four years, according to statistics from industry research and markets.

The market was valued at $42.6 billion in two years ago and is projected to spike to $70.1 billion by 2026.The growth of the market, experts said, is driven by increasing globalisation, rising adoption of managed travels by small companies and technology adoption  with tie-up and consolidation of travel management companies.

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Nigeria, which plays in this huge travel space, has witnessed the increasing influence of travel management companies, with the companies partnering domestic carriers on flexible fares, route management and flight inventory.

Besides, some of the companies, including Wakanow Limited, Travelstart, Sabre Travel Solutions, Sixth Continents, Boku Travel, Landover Travel Centre, among others, have inked deals to make the booking, payment and facilitation of travel, competitive and seamless.

Experts said the impact of travel management firms not only reduces the cost of travel for corporate organisations, because the companies engage airlines for volume sales for tickets, they also support with other anciliary services.

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Stakeholders familiar with the development said the volatility in average ticket price due to complex pricing strategies and limited effective price regulations in air travel are some of the factors that are restraining the growth of the market.

The introduction of enhanced corporate booking tools and on-the-go mobile applications and growing demand have also created opportunities for the market.

But experts said transaction security challenges and other privacy concerns are big challenges plaguing the market.

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