Tourism & Leisure

• Domestic holiday demand up as restrictions are removed
• Holidaymakers willing to spend more
• Discovering Germany’s diversity
• Digital solutions in demand

Domestic holiday demand up as restrictions are removed

Travel warnings and quarantine obligations have been dropped for many popular holiday destinations in Germany, with demand for stay-at-home holidays providing a boon to landlords, hoteliers and guests alike. The challenges faced by the tourism sector over the past year have been assuaged by rising vaccination levels and the sharp decline in Covid-19 incidence rates, making holidays in Germany a real possibility once more.

According to German Tourism Association (DTV) president Reinhard Meyer, the reopening will be cautious, subject to individual federal state and the local conditions on the ground. “On the coast and toward the Alps, it may be crowded,” he said, noting that other regions will also benefit from the boom, observing that “especially popular is everything that has to do with nature – for example, hiking or cycling.” 

Holidaymakers willing to spend more 

Increased demand is pushing up overnight stay prices, with the after-effects of the coronavirus pandemic similarly compounding typically high-season price levels. According to price comparison portal Check24, holiday apartments will cost around EUR 108 per night in the months of June, July and August – equivalent to almost 19 percent more than during the same period in the pre-crisis summer of 2019. However, holidaymaker willingness to pay more has also increased, with travelers spending around 25 percent more than in 2019. 

Discovering Germany’s diversity

Notwithstanding Germany’s traditionally popular seaside resorts and hotspots, more off-the-beaten track regions across the country are looking to capitalize on the increased demand for a German holiday experience. According to the DZT, which provides information services to potential visitors, these include the country’s central uplands for hiking trips and the Elbe sandstone mountains in Saxony which are particularly popular with climbers. The DZT believes that it is the country’s rich diversity that provides such fertile opportunity for the domestic tourism industry. 

Digital solutions in demand

The current resurgence in the tourism sector is set to lead to the next industry chapter: sustainable tourism and the intelligent use of digital data. Speaking at the DZT “Knowledge Days” event in June, founder and investor Frank Thelen observed that “we will travel a lot, more than before. But it has to become climate-neutral.” As demand for travel experiences rise, Thelen explained, so too do the challenges created for climate protection. This, in turn, will drive demand for digitally driven sustainable-tourism solutions.

The DZT is addressing the future issue of responsible tourism by positioning Germany as a travel destination with sustainable and inclusive offerings in international competition. The outbreak of the Covid 19 pandemic has intensified the shift in values toward greater socio-ecological responsibility in international travel behavior.

Germany has Europe’s largest and most competitive travel sector with a high outbound share. Travel technology start-ups are setting up camp around the country, while Berlin boasts its first travel tech unicorn. Find out more about the Travel Tech's New Frontier here

The blue lagoon at Tropical Island Berlin, a vast climate-controlled dome which has been basking in its own success since 2004. | © Dagmar Schwelle/laif

The Leisure Boom

Germany is flying the flag as the most popular destination for city breaks, reinforcing its strong position in the international tourism market. The trend is driven by bookings from European culture vultures and young people. More

• In 2019, Germans spent a total of EUR 188 billion for leisure time, entertainment and culture.
• A tourism overall turnover of around EUR 290 billion, make Germany one of the largest tourism markets in Europe.
• The German hotel and accommodations sector recorded 495 million overnight stays by national and international guests in 2019.
• The number of overnight stays by international guests increased in the year 2019 by more than 2.5% to reach 90 million.

As a tourist destination, Germany has made a name for itself around the globe. The most international visitors in 2019 came from the Netherlands, Switzerland, the United States, the United Kingdom and Austria. Certain destinations within Germany remain of particular interest to tourists from all over the world. In 2019, international and domestic travelers alike spent the most time in the well-known tourist destinations of Bavaria, Berlin, Baden-Württemberg and North Rhine-Westphalia. The top five city-destinations for all tourists were Berlin, Munich, Hamburg, Frankfurt am Main, and Cologne.

The German travel and tourism markets possess tremendous potential for both tour operators and travel agencies. Germans are known for their “travel bug”, whether on vacation or in the office, and they spend plenty of time on both domestic and international trips. According to Eurostat, Germany is the biggest domestic tourism market within Europe with an average of four nights that a German annually spends in German hotels.

The business travel sector composes an attractive subsector of the travel industry: The sheer volume of this market in 2019 of EUR 55.3 billion makes it equally interesting for both domestic and foreign travel service providers. In 2019, around 11 million German business travelers took a total of 195.4 million individual trips in total.

While looking for hotels, consumers generally make their decisions based on affordability, reliability, memorability and specialization. As a result, hotels are competing on a cost, brand or design basis. Health, fitness and age group related products are growing in popularity. Also, the luxury hotel sector is on the upswing, as evidenced e.g. by the opening of several new 5-star hotels in Berlin and other German cities in the past years.

As far as competitiveness as a travel and tourism site is concerned, Germany occupies a prominent position on the international stage. Only Spain and France have a comparably advanced infrastructure for tourism and travel. This was substantiated by the 2019 Travel & Tourism Competitiveness Report of the World Economic Forum, which analyzed competitiveness in the tourism sectors of 140 countries. Germany owes its top placement to – above all – its unique offer of cultural resources and business travel, combined with excellent connectivity, tourist service infrastructure and a strong labor market.

Travel & Tourism Competitiveness Index 2019*

_{* Source: The Travel and Tourism Competitiveness Index 2019}

Germany offers numerous incentives for all investors - regardless of whether they are from Germany or otherwise. There is a large selection of programs designed to support a wide variety of business activities at different stages of the investment process available. Support ranges from cash incentives for the reimbursement of direct investment costs to incentives for labor and research and development (R&D).