Amongst the industries most damaged by the ongoing coronavirus pandemic, the tourism and hospitality sector has perhaps fared the worst.
Government-imposed lockdowns have, for the meantime, curtailed the vast majority of international travel, with the risk of a recession and job losses looming over future recovery. It paints a bleak picture for those in the travel industry, but what do the prospects look like and are there causes for optimism?
The short term – Survival mode
The immediate future of many travel companies will certainly be in doubt; as much was confirmed with the collapse of Flybe in early March. Lockdowns across the globe have heavily restricted the amount of travel that is taking place, with a large number of airports across Europe either closed or partially closed (see below).
Beyond the lockdown restrictions, we also expect a large reduction in demand for travel. Though the extent of this is uncertain, the International Air Travel Association estimates that there will be a “13% full-year loss of passenger demand for carriers in the Asia-Pacific region”. Clearly the short term is about survival for brands within the travel industry.
The medium term
Whilst consumers are steering clear of travel purchase at this time, there is evidence to suggest that they continue to research, which presents an opportunity for brands to place themselves in the consumers’ consideration set. According to a survey from IZEA, as many as 55% of frequent travellers say they ‘may’ or will ‘likely’ purchase a future holiday whilst confined to their homes during the coronavirus outbreak.
Savvy brands will look to capitalise on this by getting themselves in front of isolated consumers with engaging content (which will still be valuable in the long term). Once lockdown is lifted, lots will look to purchase – a recent report from Tourism Economics took learnings from the SARs outbreak, from which outbound air travel in the US “spiked” quickly after the outbreak ended, whilst international air travel increased 12% the following year.
The long term
As mentioned above, lockdown is a time many brands have taken to build their organic presence in efforts to benefit from long-term traffic. However, it can be difficult to anticipate where to invest research efforts, with fears that coronavirus will shift the way we travel for good.
This should not paralyze brands; expect many of the trends that were relevant pre-coronavirus to be relevant in the future too, such as wellness travel and transformational travel. Sustainable tourism is also not going away, with an interesting undercurrent of the lockdown being focused on the regeneration of urban areas, including tourist hotspots such as Venice, whilst visitor traffic is low.
Whilst the short-term emphasis of the travel industry is undoubtedly on survival (and direct response marketing efforts may be on pause), there are definitely gains to be made for brands who invest smartly in content and think carefully about the timing of their reactivation strategy once lockdowns begin to ease.
