Devaluation of one’s own currency is one of the traditional ways for governments to support their economies: exports grow as it is cheaper to buy products from the country, imports slow down as it is more expensive for their citizens to buy goods from abroad. It also has a positive impact on tourism figures as it is more affordable to visit the country.
Thankfully, countries in the Euro-zone are not able to use devaluation individually as a tool for monetary policy to control supply and demand anymore. That might be one of the reasons why the dollar and the euro have not been equal in value since 2002 (shortly after the Euro launched). With a stronger dollar prices for energy, including oil and gas, are more expensive for countries importing those resources, but the dollar to euro parity is an opportunity for the travel and tourism industry in the countries within the European Union that use the Euro (not all do, most notably Sweden and Denmark).
“We have had a close look at the relationship between the Euro/Dollar exchange rate and the level of search demand for flights from the US to Europe.” explains Carlos Cendra, Sales & Marketing Director of travel intelligence provider Mabrian. “We can see a very clear correlation between the value of the Euro and demand for travel.”
“U.S. tourists are well known in Europe for being the dream guests” says Fabián González, founder of Forward_Travel. “They spend more, stay longer, book further in advance, enjoy the room service – and at the end they tip properly”.
Neville Isaac, Chief Customer Officer of Beonprice, a hotel revenue management tool, shares his opinion: “Traditionally in Europe, the US visitor has the highest overall spend, a longer booking window, and length of stay than almost any other feeder market.”
According to Mastercard Spain, the United States is one of the most important source markets for the Spanish tourism sector in terms of visitors, as 3.2 million U.S. residents visited Spain in 2019, and spending, with €6.7 billion spent in the year before the pandemic.
In order to take advantage of this once-in-20-years “gift”, European hoteliers and destinations should consider the US cities from which they are getting demand, the times and dates when US customers book, the channels they are using to book and the products they like the most. Taking all of this into account, they should plan their marketing campaigns accordingly.