Northeast
Asia's travel industry, comprised of four key regional
travel markets - South Korea, Hong Kong, Taiwan and Macau - is
preparing for a rebound in 2023 with the rebuilding of air connectivity across
Asia Pacific markets.
However, global economic headwinds, high inflation, volatile jet fuel prices
and the fallout from Russia's invasion of Ukraine are all concerns.
Weak currencies could impact spending power for outbound travelers. Regional
factors, such as North Korean foreign policy and China's relations with Taiwan,
loom large.
Crucially, each market is hoping that the ending of China's hardline COVID
policy will nurture a robust travel bounce back. A regional recovery requires
China to fully reopen. This will likely commence in the first half of 2023.
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According
to Phocuswright’s latest travel research report
Northeast Asia Travel Market Report
2021-2025
,
South
Korea is the region's largest travel market, accounting for 53% of gross
bookings in 2021 (see figure below).
Hong Kong and Taiwan were closely matched in the second and third spots. The
distribution of online bookings is weighted even further in South Korea's
favor. Its tech-agile travelers accounted for almost two thirds of online gross
bookings.
This reflects a diversity in booking of hotels, air, rail and car rental for
domestic travel in South Korea in 2021,
and
limited outbound travel while other markets were stagnant. Some distance behind
was Taiwan, which took the second spot for online gross bookings.
The
pandemic witnessed a dramatic surge in the popularity of smartphones to search
and book travel, with the mobile share of online gross bookings peaking in
2021.
Although this may moderate slightly, an upswing in travel activity will see
mobile booking volumes take off. Mobile gross bookings in 2023 will comfortably
surpass 2019 levels.
A projected $11.2 billion in 2025 would be more than double the 2019 record.
The
mobile travel realm is especially competitive in South Korea. Homegrown online
travel brands like Good Choice, Yanolja,
MyRealTrip
and Tidesquare
invested astutely in technology during the pandemic to capture domestic
bookings and prepare for international travel to start heating up from 2021
onwards.
Acquisition activity has also been aggressive, enabling online players to add
new product and service capabilities to their mobile apps and platforms.