Tourism demand determinants- made simple

Last updated: 8 October 2026

Understanding tourism demand is vital in order to create and maintain an efficient, profitable and sustainable tourism industry. But what are the major tourism demand determinants that organisations need to consider? This article explains the main determinants of tourism demand.

What are tourism demand determinants?

The determinants of demand are factors that cause fluctuations in the economic demand for a product or a service. This is important to consider both in the travel and tourism industry as well as in other industries. Ultimately, tourism businesses and destinations need to understand demand in order to meet it. For example, many travellers are moving away from the traditional package holiday and are instead seeking niche tourism experiences. In response to this, many tour operators have adapted the products that they offer to suit the demands of the tourists- instead of selling predominantly beach and ski holidays, many are now offering the likes of adventure tourism trips and wellness tourism retreats.

Tourism is demand-driven, so understanding current trends in tourism requires an understanding of how patterns of demand are changing. Demographic and social changes are seen as major influences on, in particular, international tourism. Dwyer (2005) argues that several types of demographic variables are changing in ways that will influence future demand for tourism and the specific types of tourism experience that will be preferred.

There are many tourism demand determinants to consider, but the major ones include:

• Life cycle changes
• Ageing population    
• Education    
• Employment    
• Time    
• Fashion
• The pleasure industry

Tourism demand- Life cycle stage

The life cycle stage is always an important determinant in tourism demand, because people of different ages tend to have different demands! Typical demands from different age groups include:              

• Children – Activities such as holiday clubs and summer camps are increasingly popular as more households have two working parents.
• Adolescents – Are at the peak of their leisure needs but lack both the freedom and the money to indulge these needs– will this change? If so, how?
• Young people – youth travel is estimated to account for around a fifth or more of international arrivals and the likes of backpacker tourism is assuming ever-greater importance. Young people are taking more gap years and volunteer tourism is growing in popularity. The adventure tourism market is to a large extent driven by ages 17-35.
• Families- Many families are now choosing to travel further afield and for longer than before, educational tourism and slow tourism are growing in popularity.
• Elderly people- Many older people have more time and money to spend on travel. Cruise tourism remains popular with elderly people, but older people are also embracing a range of alternative tourism forms too.

Tourism demand- Social and demographic variables

It is important that tourism industry stakeholders are aware of and up to date with current social and demographic variables associated with their customers.

Social structures

Many social structures around the world are changing or evolving. This includes aspects such as community aspirations, business structures and family and individual values – all of which are experiencing profound change globally.

• Household structures in Western countries are changing: households with no children are on the increase as people marry later and have fewer children.
• Family structures are changing too – the nuclear family is being replaced by the vertical family. Three or more generations may choose to holiday together, especially amongst those from developing nations, where families tend to live together across multiple generations.
• One-parent families are more common than in the past.
• There is an increase in the lucrative DINKS (Double Income, No Kids) market – this is an important market for special-interest and long-haul travel.
• More accepting attitudes in many countries, and the growing number of companies targeting LGBTQ+ travellers, have led to growth in the LGBTQ+ travel market, which is often associated with high levels of disposable income.

Population and ageing

The way that we grow old has also changed over time, and this is another important tourism demand factor that tourism industry stakeholders must consider.

• Changing patterns of marriage, divorce and living alone affect how and with whom older people travel.
• Many older people, who are fitter and more active than in previous generations, wish to enjoy the same activities and entertainment that they enjoyed in their youth; they also have more disposable income to spend on these activities.
• ‘Empty nesters’ are high spenders on travel and tourism – active and adventurous they see travel as an integral part of a fulfilling retirement.
• With above-average wealth and relatively few demands on their time the elderly make up an increasingly large part of the tourism market.
• Alongside evidence of a growing propensity to travel and spend (Huang and Tsai 2003; Reece 2004), consumption is often deliberately linked to low seasons balancing out the peaks and valleys for tourism suppliers (Hunter-Jones and Blackburn, 2009).
• New senior citizens, ‘young sengies’ (young senior generation), ‘woopies’ (well off older people), ‘retiring baby boomers’, ‘generation between’, ‘third age’ and the ‘grey market’ (Lohmann and Danielsson, 2001) are all terms used to describe what is collectively known as the ‘senior market’.
• The over-50s form an increasingly complex and diverse group. Many of them are well-off and have a high disposable income, although there is a polarity between the haves and have-nots (Beioley, 2001).
• In England and Wales, the 2021 Census found that 18.6% of the population (11.1 million people) were aged 65 or over.
• In the US, the Census Bureau projects that by 2034 there will be more adults aged 65 and over than children under 18.
• In OECD countries the over 65s grew from 145.8 million in 2000 to 211.2 million in 2020.
• There is a significant growth in the number of ‘third age’ (49-64) travellers. This is a demanding group for whom self-fulfilment is important, wanting not only adventure but also comfort and putting more emphasis on accommodation quality, sightseeing and social aspects of the holiday and care less about nightlife, beaches and hot weather (Beioley, 2001).
• Because the elderly are often well-travelled they consciously seek new places to visit that are often ‘off the beaten track’.
• They are more environmentally and socially conscious and will reward firms that show high levels of environmental/social responsibility.
• The elderly frequently will demand honesty and integrity from travel companies and will reward such companies with their custom.

Health

Since the COVID-19 pandemic, health has played an increasingly important role in the minds of the consumers. As such, those working in the tourism industry need to understand tourism demand in this area. Major considerations should be paid to:

• Disease
• Medical facilities at the destination
• Levels of crime and terrorism

Tourism demand- The changing economy

Outbound tourism has changed over the years and in response to this the tourism industry needs to meet the demands of the outbound tourists in which they are aiming to attract. Some things to consider include-

• The expanding economies of the BRICS countries (such as Brazil, Russia, India, China and South Africa) with their growing middle classes.
• Outbound tourism from China grew rapidly to around 155 million trips in 2019, and has been recovering since China fully reopened its borders in 2023.
• In India the 45-58 age middle class are already spending most of their disposable income on travel (Future Foundation).
• Recession tourism is a travel trend that emerged during the global financial crisis of 2007–2009, and similar patterns are seen during periods of high inflation and cost-of-living pressures. Recession tourism is defined by low-cost, high-value experiences taking place of once-popular generic retreats (Landau, 2007).

Tourism demand- education

Education levels also have a significant impact on tourism demand.

• Increased education among the less privileged will necessarily affect travel choices.
• The interest in special-interest tourism has been fuelled by the educated classes.
• Forecasts predict an increase in special interest and educational holidays which provide opportunity to learn from tour guides or other specialists in the field of interest.
• There is arguably greater environmental and social consciousness amongst better-educated tourists – this will fuel the demand for certain types of products.
• Lifelong learning will become the norm as people now entering the workforce can expect to have five separate careers in a lifetime (Cetron, 2002 in Lockwood and Medlik,2002).
• Large chains will increasingly become involved in training to ensure product uniformity and quality (this is important to the supply of tourism).
• Education is also an important element of tourism supply.              

Tourism demand- Modern generations and technology

Society has changed and evolved over the years, and the tourism industry needs to ensure that it is up to date with the tourism demands of modern generations. Some aspects to consider include:

• Modern generations are increasingly entrepreneurial and favour self-employment.
• They are experimental and willing to try new products, foods and attractions but are often intolerant of products or services that fail to satisfy – repeat purchasing will be out of the question in such cases.
• Customers for tourism are much more technology-literate than they previously were– this has huge implications for the industry and has seen the introduction of the likes of smart tourism, e-tourism and virtual tourism.
• Millennials (Generation Y) and Generation Z have grown up with the internet and social media – they are constantly connected and strongly influenced by online content and reviews.
• They may tire of well-known brands quickly.
• They are interested in experience and are short-term and opportunity-focused.
• They are also strongly influenced by friends and peers; concerned to achieve a work-life balance; strongly opinionated on social and ethical marketing issues; and supportive of causes such as fair trade and volunteering (Cooper and Hall, 2008).
• Because the proportion of self-employed people has increased, business travel is increasingly self-funded, so the distinction between work time and holiday time will thus become increasingly blurred e.g. the workation.

Tourism demand- money rich, time poor

Ultimately, people need two things to be tourists: money and time. However, this balance is not always optimal.

• Employment patterns necessarily affect tourist demand as money and paid holidays are enablers of travel.
• The workplace is changing: Remote and hybrid working have blurred the boundaries between work and home, and in the EU around 70% of women aged 20–64 are now in employment.
• Increasing job insecurity means that people are afraid to be away from work too long, which leads to: More short holidays, more luxury weekend getaways, more intensive holidays, more convenience, relaxation and pampering, more leisure opportunities closer to home, more constant demand for breaks and higher spend.
• When examining the work-leisure continuum it becomes apparent that time pressure will be a determinant of the type of tourism sought.
• Tourist markets are segmented not only by disposable income but also by disposable time, which differs considerably around the world.
• The rhythm of leisure time will change and the work/leisure divide become increasingly blurred as the pace of life speeds up.

Tourism demand- fashion

Ultimately, tourism is a fashion industry and destinations and types of tourism come in and out of fashion over time.

• The complex relationship between tourism demand and supply is based on the dynamics of people’s perceptions, expectations, attitudes and values.
• The demand for tourism is notoriously fickle as a result of its dependency on status and image.
• The interests and reasons for travel frequently change.
• Holidays that were previously purely recreational have in recent years moved into physical and mental rejuvenation; spiritual rejuvenation will follow.
• Customers are becoming more interested in self-improvement as part of the tourism experience with an emphasis on health, wellbeing, education, skills development and cultural appreciation.
• In an increasingly technological world, rain forests, wilderness areas, oceans and other unpolluted areas will provide a unique and necessary chance to escape from keyboards and mobile phones.
• These changes carry threats and problems but also opportunities.

Tourism demand determinants: FAQs

Below are answers to some of the most common questions about tourism demand determinants.

Tourism demand: Further reading

If you found this article on tourism demand determinants useful, these articles may also be of interest:

• What is domestic tourism and why is it so important?
• Herzberg theory: Made simple
• What is a tourist board? A SIMPLE explanation
• What is qualitative and quantitative research? An EASY explanation
• What is business tourism and why is it so big?

About the author

Dr Hayley Stainton is a tourism academic, examiner and the founder of Tourism Teacher. She has a PhD in tourism and more than 20 years’ experience teaching travel and tourism at school and university level. Read more about Hayley