This report provides a brief profile of the travel and tourism industry in Greece, with the focus on outbound travel to the U.S. and market conditions for U.S. business interests in Greece.
For more information on business opportunities in this sector, or for assistance in identifying a qualified business partner, please contact the United States Commercial Service in Greece at the address shown at the end of this report.
Overview of Greece’s Tourism Market
Travel and Tourism is the most important service industry in Greece and has a major impact on the Greek economy. Tourism constitutes approximately 15% of Greece’s GDP and one in five jobs. Greece has enjoyed a reputation as one of the prime tourism destinations in the world during the last decade. Greece continues to be a preferred tourism destination because of its safe, low-crime, tourist-friendly environment.
According to the Association of Greek Tourism Enterprises (SETE), Greece was ranked in 2010 as the 17th preferred destination for global travelers and received 15 million tourists, a 0.6 percent increase compared to 2009. Despite the relatively good news on arrivals and hotel nights, tourism revenues continued the downward trend started in 2008, falling 7.6% in 2010 compared to 2009 (€9.6 billion in 2010 compared to €10.4 billion in 2009). In addition, the average per capita tourism expenditure for 2010 was 640 Euros, an 8.2 percent decline compared to 2009. It should be noted that arrivals of foreign tourists in 2010 had been affected by major demonstrations and strikes that took place in Athens that had negative effects on the Greek tourism and the Greek economy in general. The performance of the tourism sector in 2011, however, is turning out to be much better than expected. Arrivals for January-July 2011 were increased by 13.5 percent compared to 2010. For 2011 as a whole, tourism revenues were expected to increase by more than 10 percent. A major factor for this increase was the substantial increase in the cruise passenger traffic that reached an increase of 28.5 percent (for the period January – August 2011) for the Piraeus Port only. For this reason, the year 2011 was named “cruise vacation year” for Greece. The waiver of cabotage in 2010, according to which cruise lines flying flags of third countries can perform round trips having as initial and final destination the same Greek port, is a great potential which will open up further the cruise industry and will also benefit major U.S. cruise lines.
Tourism to Greece is concentrated during the summer months due to its promotion as a “sun, sea, and sand” product. With increasing competition from neighboring countries like Turkey and Croatia, this can be a very big problem for Greece. Despite the fact that numerous tourism infrastructure projects have changed Greece’s tourism profile, Greece needs to create new tourist products to attract tourists. Ultimately, Greece must re-build its high season and promote itself as a year round destination.
Greece’s Outbound Travel Market
The outbound Greek travel market has increased substantially during the last 15 years, and especially the last six years with the arrival of low-cost carriers in Greece, the use of internet for booking of air travel and hotels, and the addition of international routes by local carriers. Over two million Greeks travel abroad, spending around one billion dollars annually on their travel. Greeks travel abroad primarily for leisure and holidays, business, education, shopping and on incentive tours, and are generally considered “high spenders”. The latter is an important consideration for U.S. entities destinations, hotels, tour-operators, car rentals agencies, and other companies that offer travel and tourism services. Market sources indicate that within Europe, Italy is the most popular destination for Greek travelers, enjoying very close proximity by sea and air, with daily passenger-and-car ferry service and short duration flights. The second most popular travel destination for Greeks is the United Kingdom. Greeks travel to the U.K. primarily for studying and shopping. It is estimated that more than 40,000 Greeks are studying at British universities. Moreover, low-fare airlines, offering very attractive air ticket prices and frequent flights, have contributed to the growing popularity of the U.K. among Greek travelers. Other European countries that attract Greek vacationers are France, Cyprus, Turkey, Spain, Germany, Russia, United Kingdom and Malta. Over the last few years, the Czech Republic (Prague in particular), Croatia and Bulgaria have also become favored destinations, and are gaining in popularity with Greek travelers. Other attractive destinations for Greeks, apart from Europe and the U.S., include Egypt, Morocco, Dubai, Tunisia, Bali, Thailand, Singapore, India, Mexico, and Hong Kong, primarily because well-promoted, conveniently packaged tours to these destinations are readily available. The average stay is 10-15 days. The Greek National Tourism Organization estimates that approximately 62 percent of the vacation trips taken by Greeks for less than five days are to domestic destinations. The majorities of Greeks, organize their trips through a travel agent, are attracted to packaged tours, and are known for late planning, especially to overseas destinations. Friends and travel guides are also considered valuable sources of information. The Internet has become a very popular source of information especially for travelers aged 20-35, who prefer mainly online services for air tickets and lodgings.
Travel to the U.S.
Despite the current economic crisis in Greece, the visa waiver act in April 2010 created the increase in visitors, aided by the favorable euro-dollar exchange rate which still makes a trip to the U.S. affordable for many Greek travelers.
According to U.S. Department of Commerce statistics, there was a slight decrease of 0.7% in Greek visitor entries for the period January-November 2011 compared to the same period in 2010. According to same statistics, the Greek visitor entries in 2010 were 64,581, an increase of 14 percent compared to 2009. However, Greek travel sources indicate that the 2010 figure number is actually around 90,000, as entries from Greece to the U.S. through other countries, mainly European, are not counted. A long-term forecast by the U.S. Department of Commerce indicates that Greek visitor entries in the U.S. will reach 71,807 in 2016 which will represent an 11 percent increase over 2010.
According to Greek travel sources, approximately 60 percent of Greek arrivals in the U.S. are independent visits, while the remaining are package trips. More than 2 million Greek-Americans live in the U.S. and approximately 5,000 Greek students study at American universities and colleges. The primary means of transportation for Greeks to the U.S. is by air.
The duration of the average travelers stay in the U.S. varies from one week to 10 days and they stay in hotels and with relatives. A Greek traveler to the U.S. visits 1-2 different U.S. destinations per trip and spends an average of $3,000 - $4,000 per trip. The average income of Greek travelers to the United States is around $50,000. The most popular destinations in the U.S. are New York, Chicago, Boston, Los Angeles, and Las Vegas. Other U.S. destinations that have become very popular, especially for honeymoon trips, are U.S. possessions in the Caribbean. Most popular attractions for Greek travelers are cities and towns, theme parks, museums, and casinos, while shopping and visiting expensive restaurants are always high priorities.
Delta Airlines and U.S. Airways operate direct/non-stop flights from Athens to the U.S. Delta Airlines operates year round flights to New York and seasonal flights (May-October) to Atlanta. U.S. Airways offers direct seasonal (May-October) flights to Philadelphia. Continental Airlines which offered direct year-round flights but with reductions on daily flights during the winter season ceased its operation in Greece in October 2011. It is worth mentioning that Olympic Air, the previously state owned airline company which is now under the control of Marfin Investment Group, has ceased all U.S. flights from/to Greece. Many European Airlines, such as British Airways, Lufthansa, Air France, and KLM, offer very attractive ticket prices to U.S. destinations through European capitals (London, Frankfurt, Paris, and Amsterdam), and are becoming popular for Greek travelers, especially for those aged 20-35.
Greek travel sources indicate that travel to the U.S. has the potential for further growth as travelers from all parts of Greece, including the islands, benefit from the visa waiver. In addition, they foresee an increase in incentive travel as the visa requirement was an important barrier for travel to the United States