Croatia’s tourism market shows strong potential, but accelerating lodging infrastructure and non-seasonal product development is essential to building the foundations for medium- and long-term growth. These are some of the key insights from our latest travel intelligence report, presented at IFC SkillUp – The Future Travellers & Markets, organized by Horwath HTL and the World Bank.
The analysis, powered by our travel intelligence, was presented by our Director of Insights & Tourism Advisory, Sonia Huerta, in a session that also featured the insights from Horwath HTL, explained by Siniša Topalović, ISHC, Global Head of Tourism Advisory.
Our data indicates that diversifying demand drivers—especially through active tourism—offers a clear opportunity to extend year-round appeal and beating seasonality. This combined with Croatia’s excellent traveller perception creates a competitive edge for this country in the Mediterranean scenario, yet maintaining these high scores in its perception indices is key given regional competition.
Boosting hotel development growth and expansion in Croatia is also a crucial priority for Croatia, as the lodging market is dominated by short-term rentals, which account for 70% of demand, while hotels capture only 21%. Although Croatia’s 4- and 5-star hotels are highly rated in terms of experience, the expansion of hotel capacity in areas exhibiting a significant disparity between rental and hotel accommodations is imperative to satisfy current demand and enhance the destination’s competitive positioning.
Active Tourism to Flatten Croatia’s Seasonality Curve
As our data shows, investing in product development focused on integrated, high-quality experiences, and prioritising non-seasonal products such as active & nature, culture, and gastronomy could contribute to tackle Croatia’s seasonality.
To achieve this goal, it is key to align connectivity growth with the goal of strengthening non-seasonal demand, building a year-round tourism economy that is more attractive to partners and investors, and enabling the enhancement of both lodging and experience offerings.
Furthermore, the acceleration of hotel development is recommended with the objective of diminishing the disparity between short-term rentals and hotels. Simultaneously, upholding rigorous short-term rental standards to accommodate traveller preferences will contribute to meeting demand, while allocating resources towards a medium- and long-term strategy for hotel expansion. Moreover, hotel development initiatives should align with a comprehensive strategy, meticulously customised for each specific location and target demographic.