The Philippines is uniquely positioned to boost its tourism revenue by focusing on high-quality, premium experiences for visitors, particularly through its food and beverage (F&B) offerings, according to a landmark new study released today by Oxford Economics.
The report, “Capturing High Quality Tourism in Southeast Asia: The Impact of Premium F&B Experiences on Destination Choice,” surveyed 1,800 travelers from key markets—China, South Korea, Australia, the United States, and the United Kingdom. It reveals that tourists are willing to pay an average of US$250 more per person, per day to visit destinations that offer premium F&B experiences characterized by exceptional service, variety, and authentic local flavors.
Shifting from Volume to Value
The study comes as the Philippine tourism sector shows strong recovery, with arrivals from January to August 2024 reaching 65% of pre-pandemic levels. However, authorities are now strategically pivoting from a volume-driven model to one focused on quality and value.
“High-value tourism is about authenticity and memorable experiences, not confined to luxury resorts,” said Carmela Febrio, Acting Head of the Americas Division at the Philippine Tourism Promotions Board (TPB). She emphasized that local F&B experiences introduce visitors to the vibrancy of Filipino culture, offering something “they cannot find anywhere else.”
Her colleague, Ramon Julian de Veyra, Acting Head of the Europe, Africa, Middle East, and India Division at TPB, added that this shift towards sustainable, premium tourism ensures long-term growth while protecting destinations from the negative impacts of mass-market, low-cost travel packages.
Key Findings from the Oxford Economics Report:
The comprehensive study outlines six major insights for capturing high-quality tourism:
- F&B is a Major Decision Driver: Over 70% of surveyed travelers said the range and quality of F&B options are important or very important in choosing a destination.
- Premium Experiences are a Powerful Magnet: Tourists are 2.5 times more likely to choose a destination offering premium F&B experiences over one with standard offerings.
- Willingness to Pay a Premium: The reported willingness to pay an extra $250 per day is consistent across income brackets, not just luxury travelers.
- Value-for-Money Remains Paramount: Even high-income tourists prioritize value, with a $20 daily price increase for premium experiences causing 10% of travelers to choose a less expensive option.
- Preferences Vary by Market: Chinese travelers highly value easy access to F&B, while those from Korea, the US, and the UK place a higher premium on exceptional service.
- Safety is Non-Negotiable: 84% of prospective tourists rated the safety and reliability of F&B as critically important to their destination choice.
A Strategic Imperative for the Philippines
Maria Margarita Montemayor Nograles, Chief Operating Officer of the TPB, stated that the report arrives at a pivotal time. “The idea of ‘quality’ has evolved towards curated, meaningful, and bespoke experiences. The Philippines is exceptionally well-positioned to meet this demand with sustainable journeys rooted in our culture and creativity,” she said.
The study recommends that policymakers and industry stakeholders embrace premium F&B, facilitate variety and accessibility, ensure safety standards, maintain price competitiveness, and foster public-private partnerships to upgrade the overall tourism experience.
Cross-Industry Collaboration is Key
Nok Laohaphan, President of the Alcoholic Beverages Alliance of the Philippines Inc. (ABAPI), a supporting partner of the study, highlighted the importance of collaboration. “Partnerships among hospitality, F&B, and local producers are essential to create immersive, premium experiences that meet global standards while supporting local businesses,” he said.
With its rich cultural heritage, diverse cuisine, and natural attractions, the Philippines is now charting a course to become a leading destination for travelers seeking deeper, more personal, and premium experiences in Southeast Asia.
The full Oxford Economics report, commissioned by the Asia Pacific International Spirits and Wines Alliance (APISWA) and ABAPI, is available for download here.
