Incentive Travel

The United States, France, Italy, Spain, Germany, China, India, Japan and Thailand lead a global incentive travel surge, with Asia-Pacific showing the fastest growth.

The incentive travel market has been expanding rapidly, and industry experts are projecting significant growth in the coming years.

According to a recent report by Allied Market Research, the incentive travel sector—which was valued at $42B in 2021—is expected to surge to $216.8B by 2031, growing at a compound annual growth rate (CAGR) of 12.1 percent from 2022 to 2031. This notable increase points to shifting corporate travel preferences as organizations worldwide are investing in unique and high-value experiences for their employees and partners.

What’s driving the rising importance of incentive travel? For one, companies are increasingly using travel incentives to boost employee motivation, enhance loyalty, and improve workplace performance. Additionally, with the increasing globalization of businesses, organizations are looking for ways to recognize and reward their workforce, while also fostering professional development and strengthening business relationships.

Breakdown of Market Segments

The market has been segmented based on several factors, including the source of travel, industry type, end users and regional distribution.

• Domestic vs. International Travel: The domestic incentive travel segment dominated in 2021, accounting for more than three-fourths of the market share. However, international incentive travel is expected to witness the fastest growth, a trend reflecting a growing preference for cross-border corporate travel experiences that offer employees and clients a chance to explore new destinations and cultures.
• Industry-Specific Trends: Among the industries utilizing incentive travel, the healthcare sector—pharmaceutical companies, medical organizations, and healthcare service providers—was the highest contributor in 2021 and is expected to grow at a steady rate of 11.13 percent CAGR through 2031.
• Corporate Institutions Leading the Market: Corporate institutions accounted for more than 90 percent of the market share in 2021, and they are expected to continue leading the segment in the years to come. Large multinational companies and businesses seeking to improve employee engagement and strengthen partnerships are likely to drive further expansion in this sector.

Where Incentive Travel Is Thriving

While incentive travel is growing worldwide, different regions are showing varied patterns of development, as follows.

• Europe Dominates in Market Share: In 2021, Europe accounted for nearly two-fifths of the total market share, making it the largest revenue-generating region for incentive travel. The continent’s rich cultural heritage, diverse landscapes, and extensive hospitality infrastructure have contributed to its dominance as destinations such as France, Italy, Spain and Germany continue to attract corporate travelers seeking high-end, immersive experiences.
• Asia-Pacific’s Rapid Growth: Although Europe currently leads in revenue, the Asia-Pacific region is expected to grow at the fastest rate, with a CAGR of 12.79 percent through 2031. Countries like China, India, Japan and Thailand are increasingly emerging as key players in the incentive travel market, thanks to their expanding corporate presence, improved airline connectivity and growing interest in business tourism.
• Here’s a staggering number for you: 10,000. That’s how many attendees will on an incentive trip from China to Melbourne, AU this year, said Julia Swanson, CEO of the Melbourne Convention Bureau, at this year’s AIME conference in Melbourne. “It’s potentially the largest incentive Melbourne has ever hosted,” she said.

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