U.S. Travel Goods Sales Hit Record High of $22 Billion in 2007 ...

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Travel Goods Association Releases Report on State of the U.S.Travel Goods Market 1998-2007: A Profile of the U.S. Travel GoodsMarket
PRINCETON, N.J., May 30 /PRNewswire/ -- Even as the economy startedto slow in 2007, Americans continued to realize the benefit ofusing travel goods as part of their everyday lives, leading to yetanother record year for sales in 2007, according to a new reportfrom the Travel Goods Association (TGA). Travel goods are definedas luggage, backpacks, travel/sports bags, business cases/computerbags, handbags, personal leather goods, and travel accessories (thereport does not include the category of travel accessories in itssales figures). TGA's report estimates that U.S. consumers spent arecord $22.2 billion on these items in 2007, fueled by burgeoningconsumer demand in virtually all travel goods categories.
"Whether they are flying to Hong Kong or commuting to work,consumers today want to carry more with them wherever theygo," explains Michele Marini Pittenger, TGA's President."The average consumer today not only carries a cell phone, butthey also have a BlackBerry, an iPod and possibly a laptop. Ifthey're traveling, they need space for all of these things as wellas their clothes, while complying with the airlines'ever-increasing restrictions on the size, weight and number ofitems they can bring onboard. And, for everyday use, consumers arenow carrying all of these electronic items plus what they need forwork or school, and often workout clothes as well."
As consumers' demands grow on the travel goods they use to meetthese changing needs, the U.S. travel goods industry is respondingwith new and better products. "Consumers want to buy travelgoods that meet all of these demands. That want has translated intocontinued pressure for the U.S. travel goods industry to continueto create products that are more versatile and functional, yet atthe same time are smaller, more stylish and more lightweight. Ofcourse, consumers want all of this at a good price. Record travelgoods sales in 2007 show that we have succeeded," commentedPittenger.
Here's a quick look at how TGA estimates each of the major travelgoods categories performed in 2007:
Luggage
Consumers demanded better product at lower prices in 2007. WhileTGA estimates that the pieces of luggage sold in the United Statessurged 20.6% to a record in 2007, the value of that luggageincreased only 8.2%. As a result, the average retail price paid foreach piece of luggage fell over 10% from the 2006 average price --to the lowest average unit price in decades. U.S. luggagemanufacturers and brands have responded to their customers,providing "value" luggage -- or higher-quality, butreasonably-priced luggage -- at as many price points and through asmany retail channels as possible -- even selling "value"luggage through such unorthodox retail channels as grocery and drugstores. Thanks to these efforts, retail sales, valued in dollarterms, have finally returned to pre-September 11, 2001 levels. Withthe "one-bag" policies being implemented by all of theairlines this year, the demand for more versatile and practicalcarry-on bags as well as more versatile and lightweight luggagecould rise, meaning that this "value" equation couldchange in 2008.
Backpacks
Backpacks continued to grab a larger share of the U.S. travel goodsmarket in 2007 as more and more people used them as the primarymode of carrying their accessories in more and more aspects oftheir lives. TGA estimates that unit volume sales of backpacks grew9.2% in 2007, while the value of those sales increased 5.5%. Partof this increase could be attributed to consumers getting morevalue for their money, with the average price paid on backpacksslipping 3.3% in 2007.
Travel/Sports Bags
While this category remains dominated by "freebies," orpromotional bags used by companies as giveaways to customers anddistributed to attendees at conferences and events, the airlines'increasing enforcement of weight-restrictions on checked luggageand the growth of lightweight, fashionable, multi-functional totesled to a TGA-estimated 7.4% increase in unit volume sales oftravel/sports bags in 2007 and a 6.1% increase in sales by value.These new totes also helped slow the long-term decline in pricesfor travel/sports bags, with the average retail price slipping only1.2% in 2007.
Business Cases/Computer Bags
Even with other travel goods, like backpacks and totes, eating intoits traditional market share, U.S. travel goods firms unveiledenough innovative products and catchy designs to keep consumers'attention. TGA estimates that consumers pushed unit volume sales inthis category up 1.1% in 2007. Sales of business cases/computerbags by value, however, decreased 3.7% for the year. Hence, thegrowth in volume sales came at a price, namely that the averageretail price for business cases/computer bags fell by 4.8% in 2007.
Handbags
Handbags maintained its position as the travel goods industry'sbestseller in 2007. Women's love affair with handbags in generalcombined with their desire to have "the" bag, led torecords in both actual sales and the average unit selling price.While TGA estimates that unit value sales increased a strong 3.4%in 2007, the value of those sales surged 11.2%, leading to awhopping 7.5% increase in the average retail price for handbags.While sales of most handbags continued to be brisk in the firsthalf of 2008, there are growing signs that the ongoing economicslowdown could start affecting handbag sales in the latter half ofthis year.
Personal Leather Goods
The downward trend in sales in this category continued in 2007. TGAestimates that volume sales of personal leather goods fell 4.4% in2007. The value of those sales, on the other hand, increased 4.6%,leading to a healthy 9.4% increase in the average retail price forpersonal leather goods. Once again, U.S. travel goods firms werethe victims of their own success. By making their other productsmuch more versatile, enabling consumers to carry all of theirvarious electronic gadgets and other accessories, many consumers nolonger felt the need to purchase separate items for carryingaccessories. As we noted last year, the rise of iPods andBlackBerrys have also eaten into sales of two core personal leathergoods items -- CD cases and day planners. On the positive side,consumers who still bought personal leather goods were willing topay more to buy the best personal leather goods possible.
For more information, go to TGA's just released State of the U.S.Travel Goods Market 1998-2007 Report at http://www.travel-goods.org/press/release/tgamarket2007.pdf (PDF format) or contact TGA at 609-720-1200, x-205 to learn moreabout the latest trends in the U.S. travel goods market.
SOURCE Travel Goods Association
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