Business tourism in Russia

Tourism in Russia

Main article: Tourism in Russia

Business trips in Russia

Main article: Business trips in Russia

2023

Growth in the number of business trips in Russia by 21%

In 2023, about 21 million business trips were made in Russia. This is 21.5% more compared to 2022, when their number was estimated at 17.3 million. Significant growth is due to several reasons: increased business activity and the search for new partners, a change in the geography of business travel, combining business travel with recreation, as well as the restoration of the popularity of personal meetings instead of the online format. Market analysis is provided in the BusinesStat review published on July 11, 2024.

It is noted that the maximum number of business trips in the country was recorded in 2019 - 24.4 million. Analysts say the industry's booming growth has been helped by a comprehensive set of factors. Among them are digitalization, the introduction of the electronic visa regime and the emergence of new companies interested in the professional organization of business meetings and events. In addition, the range of services was actively expanded, including on the basis of mobile applications.

In 2020, the number of business trips in Russia decreased by 32.8% and amounted to 16.4 million. The reason for the decline was the COVID-19 pandemic, which provoked an increase in demand for remote communications. In 2021, the volume of the business tourism market in the country recovered by 31.5%, and the number of business trips rose to 21.6 million. However, it was not possible to achieve a pre-pandemic level due to the remaining low solvency of some consumer companies and the preservation of epidemic restrictive measures.

In 2022, there was another decline: the number of business trips decreased by 19.7%. Due to the current geopolitical situation, the level of business activity has decreased, and attending many international meetings and exhibitions has become impossible for Russian participants. Some state institutions experienced difficulties in financing, some of the state projects were suspended.^[1]

Growth of the Russian business tourism market by 30% to 827 billion rubles

The volume of the Russian business tourism market in 2023 increased by 30% compared to 2022 and amounted to 827 billion rubles. Such data are a member of the Board of the Union of Business Tourism Agencies (SAD), Managing Director of Corporate Business Wipservice Galina Polishchuk published at the end of May 2024.

According to her, most often business trips are made in Russia: they accounted for 88% of business tourism in 2023. At the same time, as Polishchuk noted, there is an increase in the number of foreign trips, which is associated with an increase in business activity and access to new regions. The main directions among business trips in Russia remain Moscow and St. Petersburg, but growth rates are observed in other cities, she stressed.

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According to a member of the SAD board, mainly the travel budget consists of the costs of air tickets, which account for 58%, the second serious component of the budget is hotel accommodation, they account for 24.5% of the budget.

Speaking about international business trips, she clarified that their number is growing. The most popular destinations in 2023 were, and Turkey Serbia. Kazakhstan In addition, the number of trips to countries is growing. BRICS

The geography of business travel abroad is shifting, we see that the demand for Asia has noticeably increased... at the same time, there is also an increase in trips to Latin America and Africa, - said Galina Polishchuk.

Among the methods of movement, more often business travelers choose air travel. At the same time, since 2022, the share of buying tickets to business class for business trips in Russia has been decreasing. On routes where high-speed branded trains are developed, such as Swallows, Sapsans, travelers choose to move by train, a SAD member said.

Most often, large companies resort to the services of travel tourism agencies, where a large number of employees, added Denis Matyukhin, a member of the SAD board, chairman of the board of directors of the Aeroclub Group of Companies.^[2]

The volume of business tourism returned to the level of 2019

At the end of 2023, the total volume of the Russian business tourism market reached the level of pre-pandemic (we are talking about the COVID-19 coronavirus pandemic) 2019. According to Alexander Kurnosov, vice president of the Association of Tour Operators of Russia for Business Tourism, in January 2024, the segment's turnover in 2023 amounted to 500-600 billion rubles.

According to him, the main factors in the restoration of business tourist flow were the growth of the economy and production in Russia, as well as the development of new logistics ties after the events of 2022. At the same time, about 93% of all business trips within the country were made by Russians - traditionally the main consumers of services in this segment.

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The demand for hotel infrastructure from business representatives has grown significantly - by 17-19% compared to 2022. More than 60% of bookings were for hotels of categories 3 and 4 stars, the share of five-star hotels was about 10%.

As a new trend, we can note an increase in bookings for accommodation facilities without a star category, which include apartments and apartments, - said Kurnosov.

At the same time, the average cost of a hotel room in 2023 rose by 10% to 5 thousand rubles. According to the vice-president of ATOR, Moscow and St. Petersburg have traditionally become the main destinations for business travelers within Russia. At the same time, significant demand was observed in such cities as Krasnoyarsk, Nizhny Novgorod, Vladivostok, Kazan, Yekaterinburg.

In addition, he noted that outbound business tourism from Russia also grew by 25-30%. Russian business tourists most often went on business trips to,,,, and Kazakhstan China Turkey. Uzbekistan UAE Belarus

According to Kurnosov, inbound business tourism is also recovering by the beginning of 2024, and at a faster pace than excursion tourism. The share of foreign business tourists amounted to about 6-7% of the total tourist flow, which is four times less than before the pandemic. However, at the same time, their profitability for Russian service providers increased, including due to the departure of foreign online booking services.

In 2024, according to ATOR specialists, the growth of business tourism in Russia will continue at the level of 5-7%. The general state of the economy, an increase in the budgets of companies for business trips, as well as the expansion of the use of electronic visas by foreigners will positively affect it.^[3]

Increase in the number of business trips by 4 times

In 2023, the share of business trips in the total tourist flow quadrupled. Such data at the end of December 2023 were cited by analysts of the OneTwoTrip for Business service.

According to Kommersant, citing materials from OneTwoTrip for Business, in 2023 foreign destinations formed 22% of Russians' business trips (an increase of 16.5 percentage points compared to 2022), which is slightly less than in 2019 (25% of business trips), when there was no pandemic coronavirus COVID-19. In 2020-2021, the shares were measured at 5.3-5.7%.

The share of business trips in the total tourist flow has quadrupled

Vipservice told the publication that in 2023, foreign destinations formed 19% of business tourist trips, 3 pp more than a year by year. Trivio noted an increase of 6 pp, to 17%. In the Aeroclub, the number of air tickets sold abroad increased by 48% year-on-year.

Analysts interviewed by the publication believe that the increase in the number of business trips is directly related to the construction of new business ties with enterprises in China, Turkey, India and Iran (in general, the Middle East region). So, 0.04% was booked to Beijing in 2022, and 1.9% in 2023. In 2023, 3% of entrepreneurs flew to Shanghai, and in 2022 there were practically no visits there.

Most flights are still to Istanbul (16.8%), but experts remind that Turkey often acts as an intermediate point. Promising areas are also Minsk (8.1%), Almaty (7.2%), Yerevan (7.1%), Tashkent (5.9%) and Dubai (5.2%).

The most noticeable demand for travel abroad has grown among representatives of the IT industry, telecommunications companies, and the oil and gas sector, said Yulia Lipatova, managing director of Aeroclub. She said the average length of business travel is six days.^[4]

2022: Market volume decline by 10.3% to RUB 608 bln

The volume of the Russian business tourism market in 2022 amounted to 608 billion rubles, which is 10.3% less than in 2021, when the figure increased by 44.9% (to 677.8 billion rubles). Such data are given in the BusinesStat study released in October 2023.

It follows from it that in 2022 the number of business trips dropped by 19.7%, which led to a decrease in the revenue of Russian tour operators of the business travel industry, even amid rising prices for industry services (+ 11.7%).

In 2022, attending many meetings by Russian tourists was canceled due to a freeze in investment activity and a revision of the business costs of domestic companies; obstacles to entry into the territory of Western countries; reduction of rotating world events in Russia. Under the current conditions, companies switched to interactive meetings with business partners. The need for business trips has decreased, according to BusinesStat.

Analysts remind that consumers of services in the field of business tourism are employees sent on a business trip. Work trips are made for the following purposes:

• participation in scientific conferences and exhibitions for obtaining a certain status, exchange of experience, presentation of a new product or conclusion of new contracts.
• participation in production lectures and meetings for the development of new products and
• market segments. Training in programs and courses to expand professional competencies and knowledge.
• business development in new territories.
• holding corporate events, contests to unite the team, exchange experience between different structural units, and increase the corporate spirit.^[5]

2021: Market Recovery

At the end of 2021, the Russian business tourism market fully recovered and reached the indicators of 2019, when there was no COVID-19 coronavirus pandemic yet. In 2021, the volume of hotel reservations by business representatives increased by 91% compared to the previous year. Such data were published by the agency of business tourism and travel management "Aeroclub" in January 2022.

The most expensive cities in terms of the average cost of accommodation at the end of 2021 were St. Petersburg (6400 rubles, + 3% by 2019), Moscow (5500 rubles, -2% by 2019) and Sochi (5300 rubles, + 6%), and two years earlier Sochi lost third place to Vladivostok.

The Russian business tourism market fully recovered in 2021

According to experts, in 2021, in the Russian Federation as a whole, the cost of accommodation in hotels has not undergone serious changes in relation to dock-like indicators. Accommodation for one night in a five-star hotel on average cost business representatives 7,200 rubles, which is 5% higher than two years earlier. The average cost of hotels of category 4 and 3 stars remained at the level of 2019 and amounted to 4800 rubles and 3600 rubles, respectively. The average check for accommodation objects without a category fell by 8% and amounted to 3,000 rubles.

According to the study, most often in 2021, representatives of the mining, manufacturing and power industries stayed in Russian hotels. The number of nights in this sector increased by 38% compared to 2019, and the average cost of living decreased by 12% and amounted to 3,800 rubles. And the highest average cost of accommodation is for representatives of financial and consulting companies: 6 thousand rubles (+ 1% by 2019), while the volume of accommodation here increased by 23% compared to pre-pandemic indicators.

Managing Director of Aeroclub Yulia Lipatova announced on January 21, 2022 that the demand for business trips in Russia is likely to continue to grow.^[6]

Notes