With lockdowns easing, we present two differing views on how people may respond to newly-regained freedoms to travel:
Global travel demand will take years to recover from the Covid-19 pandemic and many business travellers may never return to the skies, but what scale of demand could we expect to lose to technology adoption and changing travel behaviours?
The answer remains the same as it did a month ago - nobody really knows.
The consensus is that the figure will be somewhere around 5% to 10%, but some estimates put it as high as 15%. The true scale of the loss may be difficult to measure as ultimately business travel spend will grow as population and economic influences change and cloud the figures. Business travel is the foundation of the travel sector and an essential ingredient of any airline’s business model, but that certainty comes with a caveat: adaption to new technology could change how we approach corporate meetings in the future. It could also be the undoing of some airlines that have been reliant on its premium clientele to deliver revenues, in the short-term, at least. As William (Bill) Franke, managing partner of airline investor Indigo Partners recently noted, any company that is skewed to business travellers will ultimately be behind the recovery of the ULCC and LCC operators.
The global business travel sector is expected to take an USD820 billion revenue hit this year, USD190 billion in Europe specifically and right now there is limited co-ordination between countries. Quarantine requirements could add 14 day lockdowns at each end of any journey, and even if travellers are freely permitted from accessing a country via so-called bubbles, previous travel could ultimately force them to comply with entry restrictions.
This all makes technology a more attractive option right now, but when it comes to leisure travel you are not going to holiday via these platforms so we can still expect an pent up demand once restrictions start to ease. But, having faced lockdowns and travel restrictions this is all generating a situation where ‘fear transcends desire,” says nation and city branding and marketing specialist, Bloom Consulting. In a recently published report ‘Covid-19: Impact on Tourist Behaviours’ that brought together an international survey of 4,000 travellers with global online searches from its Digital Demand software, it highlighted some necessary changes that will need to occur in both tourism and the economy sector, as well as how perceptions will change as the pandemic unfolds over time.
The biggest impact on traveller behaviour was identified as the increased fear to travel. Its survey highlighted that some 45% of travellers would not travel for leisure in the next 12 months if Covid-19 is simply controlled, but remains part of our lives; falling to 35% even if it is nearly eradicated and a treatment is found; and still 15% even if it is fully eradicated. Less income has been suggested as having a major impact on travel sentiment and while the reduction of disposable income is a major consequence of this crisis, it will not be the main reason for less tourists. Each traveller that responded to any of the three above scenarios saying they will not travel claimed feeling unsafe as the overarching reason why. This suggests ultimately that fear of catching the coronavirus has taken precedent over the desire to travel for leisure purposes.
Feeling unsafe is by far the main reason for travellers refusing to travel, a long way ahead of factors such as lack of income
“This dynamic becomes the ultimate challenge for tourists and destinations,” says the report, however, it foresees this effect only having short-term implications and would see a transition to what is perceived as a safer destination rather than a cancellation of travel. It suggests that the way travellers perceive government actions and how effective they were in dealing with the crisis will affect their willingness to visit the country.
The current crisis “will take time to pass and the damage will be overwhelming,” says Bloom Consulting, and it offers four recommendations for destinations to incorporate into their structures:
avoid competing over price – less crowded destinations and improved healthcare systems are tourist’s main concerns;
redesign and redefine the tourism offer – make sure the brand strategy emphasises that the destination is appealing and safe and the product offer must be adjusted to tourist’s new expectations and needs;
broaden your scope influence and data – government action is at the core of how destinations are perceived and will play a leading role in its promotion;
adapt your current structure – it is essential for DMO’s to have a team or a plan in place that is ready to adapt, analyse and respond to a new normal or any arising crises.
But, above all, as the report highlights, ahead of the arrival of Covid-19 the tourism industry was facing structural problems that had to be addressed. “This is a once in a lifetime opportunity. We may not have another chance to rethink and redesign the tourism industry,” it says, regardless of how the ‘new normal’ appears.
You can’t keep a good traveller down: consumer searches are on the increase with short trips and smaller groups likely to dominate in early stages
Travel platform Tripadvisor has released results of a multi-month survey of consumer habits since the first signs of the Covid-19 pandemic. Taken from numerous surveys as well as from site behaviour, the report is able to show how the different phases of the pandemic have influenced how consumers look at travel.
Tripadvisor has split the recovery into five distinct phases:
Decline – as the pandemic spread and countries imposed restrictions so travel declined sharply;
Plateau – the stay indoors mantra being used around the world kept travel to a minimum;
Emerge – as lockdowns are gradually lifted so people begin to venture out again;
Domestic – confidence in travelling first translates to domestic travel;
International – the last part of travel to recover as people become more comfortable travelling abroad.
The good news is that even in the early days with air travel shutting down and forcing trips to be cancelled and postponed, consumers were still fairly bullish about future travel with 34% of consumers surveyed in Mar-2020 saying they were optimistic of taking planned trips at a later date rather than cancelling altogether.
While we were all in lockdown, many of us dreamed of our next trip with searches on the increase as we start to look at where to go next. We may have been anxious about going out but we could still see a future which included travel, with 68% reporting in Apr-2020 that they were thinking about travel and where they would book once restrictions had lifted.
Most markets worldwide have shown significant recovery in year-on-year hotel views when comparing the position at week ending 31-May-2020 with week ending 29-Mar-2020
From Apr-2020, Tripadvisor started to see a steady week-on-week increase in traveller search activity, particularly with domestic travel for more than 90 days into the future. This was most prominent in markets such as Germany, Australia and Japan where the early seeds of recovery were being seen. As many countries emerge from the worst of the pandemic and the curve is on the downward slope, so consumers’ thoughts of travel are on the increase. This is largely where we are today and so consumer activity is particularly relevant to how travel will develop in the coming months.
The biggest concern of all travellers as they look to the future is cleanliness and safety. Nearly nine in 10 consumers (86%) are reporting that cleanliness will be very important when selecting accommodation. Some 82% say that the disinfecting of high contact surfaces is a very high consideration when deciding on tours and attractions. This concern puts the onus very firmly in the hands of the hospitality industry to make sure consumers are left in no doubt that they are doing their utmost to keep guests safe. The reward of more bookings will definitely go to those that rise to that challenge and successfully implement and communicate to their customers their safety and flexibility protocols.
As has been predicted by many, signs for the early revival of domestic travel is being borne out by consumer searches. Tripadvisor’s site behaviour analysis initially saw this in the early stages of the pandemic with consumers searching for domestic locations 90 days into the future. As countries emerge, however, interest is growing with some showing early signs of recovery. Norway, South Korea, Belgium, Austria and South Africa all recorded spikes in hotel searches in early Apr-2020. Switzerland, New Zealand, the Netherlands and Germany are all also showing similar recovery signs. Since mid-May-2020 domestic travel searches for travel within 30 days have grown considerably in the US as well as Italy, France, Germany and New Zealand.
Searches for domestic travel within the next 30 days are growing rapidly across many key markets
One country that is bucking the domestic travel trend is Canada where consumers have continually been searching trips to warm beach locations such as Aruba and the Bahamas so it may be one of the earliest countries to have their international travel increase. As to the type of trip likely to be taken, there is a definite leaning towards outdoors destinations closer to home. Road trips are particularly popular as they mean less contact with people, with nearly half (44%) saying they are likely to take a road trip and two thirds (61%) saying they are most comfortable taking a road trip of 3-5 days.
The desire to stay away from crowds is also reflected in the fact that 80% of consumers reported they are more likely to travel with family and 60% saying they are more likely to travel with just one or two friends. Going somewhere to relax is definitely top of the list with consumers being three times (218%) more likely to go to somewhere remote than before the pandemic, and 59% saying they would prefer somewhere away from crowds. This is translating into an increase in searches for rural accommodation such as campgrounds, ranches and beach motels, with canoeing, skiing, boating and horseback riding popular activities. These types of holiday clearly combine the ability to socially distance with being outdoors and an ability to relax. City breaks are definitely on the decrease as not relaxing nor easy to socially distance.
The good news is that there are definite signs of international travel beginning to pick up although short haul is likely to be more popular in the near future. However, under half (43%) believe that they won’t be taking an international trip for at least a year, with just over a quarter (26%) planning a trip within the next six months. These search results clearly show that during lockdown days we have not stopped dreaming of future trips and have spent time doing research to prepare for the future post Covid-19. The frustration of wanting to get back out there is not going to stop many people taking a relaxing trip just as soon as restrictions allow.
© The Blue Swan Daily
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