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Can the Travel Industry Survive?

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INFLUENCER: One Green Bean's Kat Thomas on the challenges, opportunities and trends facing the travel sector in a post-Covid world

Can the Travel Industry Survive?

My business exists because a global airline, famous for championing entrepreneurialism, took a punt on a start-up back in 2007. It was the airline that made headlines and history with ‘BA CAN’T GET IT UP’ in 1999, demonstrating an innate appreciation for PR. 

Fast forward over decade and I’m proud to say we still work with Virgin Atlantic, it sits alongside a destination tourism board and the world’s biggest hotels platform in our travel team. They’re all trying to make sense of a situation that was in nobody’s forecast, because this is a sector that models around a fair-weather future - assuming constant demand, open borders and unrestricted movement. 

Few industries have fallen as fast or as hard. The World Travel and Tourism Council has made bleak projections – a loss of 75 million jobs and $2.1 trillion in revenue. But I believe there will be a recovery. It won’t be quick, there will be casualties. Most must now overhaul commercially. But the industry survived 9/11 and some will emerge stronger. 

People will have been locked up for weeks, possibly months, when this ends. Those who can afford to, will look to travel to re-engage, reunite and rebalance. Beyond aid packages and internal recalibration, what trends are we likely to see?

Local – it’s natural to assume this will be the year people holiday closer to home. Partly due to a nervousness around overseas travel, but equally propelled by a sense of national pride – to support hotels, restaurants, local destinations. Here in Britain, this could mean a boom in visitation for the islands, highlands and everywhere in between. 

Last minute booking – there are two types of travellers; those who book in advance to savour the build-up and manage the cost, and those who wait for last minute bargains and embrace spontaneity.  This pandemic could have a very long tail, which will prompt more people than ever to wait to the last second to commit. Meaning airlines and hotels will struggle to predict occupancy.

Travel insurance – rolling news of people abandoned on cruise ships, needing repatriation and those caught up in the sudden demise of FlyBe will have made a mark. Expect more policy scrutiny from consumers - agile providers will seize the opportunity to shift the category away from its current murkiness. 

Abandon ship – if there’s a poster child for the pandemic, its cruising. The impact has been devastating, an estimated loss of revenue to the tune of $750 million since January. Even the British PM advised those over 70 not to book anytime soon. Which let’s face it, must be the demographic that keeps this sector afloat. Unfortunately, it will be fighting for survival. 

Loyalty from goodwill – the response today will reap long term rewards – actions like the American Hotel & Lodging Association making properties available to healthcare professionals, EasyJet and Virgin Atlantic redistributing cabin crew to NHS Nightingale, plus the booking platforms that have waivered their cancellation policies and the destinations that have pivoted from salesy content to offering hopefulness. It’s irrefutable now, that consumers demand to see an authentic conscience and social purpose. 

The first glimmer of hope will come from China, where the earliest signs of recovery are being reported. According to Bloomberg, hotel bookings rose by 40% in March. The CEO of Marriott substantiated this. It is the domestic market of course, but it’s a start. 

We don’t yet know the extent of the impact. What we do know is there will need to be a global movement around trust – airlines, hotels, resorts, attractions will need to massively invest in rebuilding consumer confidence. A pent-up desire to travel will prompt the shift to recovery, but an already competitive sector will now need to work even harder to differentiate in a post-Covid world. 

Kat Thomas is founder of One Green Bean 

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Havas UK, Wed, 08 Apr 2020 09:16:27 GMT