The tourism industry has been one of the hardest hit by the Coronavirus pandemic. Most countries have imposed travel restrictions as a measure to control the spread. But with many countries approaching the peak of infections while others such as New Zealand have been declared Coronavirus free, there is a ray of hope for the gradual revival of tourism and travel. The European Union on the 30th of June 2020 agreed to open some of its borders to a few countries deemed safe such as Japan, China, Canada, and Australia. This means that travel businesses should start making plans on reopening. However, travel may not be conducted as usual. Let us take a look at some of the possible changes in travel to gain insight as to how travel businesses should better prepare for reopening.
How the Coronavirus has Affected the Tourism Industry
Since the state of the industry directly affects your travel business, let us have a look at where we are at to better understand where the industry is headed.
The current state of the tourism industry is quite grim. With the World Travel and Tourism Council, an association of some of the World’s largest global travel agencies projecting a loss of 75 Million Jobs and 2.1 Trillion dollars in revenue globally.
Many airlines such as Fly Emirates, Air Asia, and British Airways were reported to have laid off some of their staff as a result of the pandemic. This may have been a consequence of inbound and outbound flights being suspended by many countries all around the globe. Currently, few hotels in many countries around the world remain, with minimal staff. In the US it is estimated that a fully staffed hotel with 50 employees on average is staffed down to 14.
Predicted Changes in Travel
It is believed that local travel is much more likely to begin to operate at near-normal levels as soon as local travel restrictions are lifted. This is based on observation of China which has recorded an almost complete return to normalcy after travel restrictions were lifted from provinces such as Hubei which were Coronavirus hotspots.
The United States travel Association together with MMGY travel intelligence are conducting a study every fortnight on business and leisure travellers.
Some of the major findings from the study include:
1. 80 percent out of 99 percent of travellers either cancelled or postponed their travel plans due to the coronavirus pandemic.
2. Also, almost 6 out of 10 leisure travellers cancelled a planned vacation, and 1 out of three resorted to postponing their vacation plans with the hope that things might get better later this year.
3. After the Coronavirus, more than half of the travellers surveyed acknowledged they would be eager to travel for leisure. Out of those, 4 out 10 are more likely to travel by plane to another state or country, while 1 out 3 are likely to travel locally. This statistic further supports the prediction that local travel will likely pick up first.
4. According to the survey, consumer intent for travelling is plummeting as the virus continues to spread and affect many more states. The intent for leisure travel fell from 39 percent to 31 percent in the second wave. Travel business also fell from 26 percent to 21 percent.
5. As for travel activities, consumers are more willing to participate in some compared to others. Intent to stay in a hotel or resort is reported to have fallen from 41 percent to 33 percent in the second wave. The intent for domestic travel has also fallen from 39 percent to 31 percent.
6. Travellers’ concern about contracting the coronavirus continues to rise especially among young travellers. The concern is estimated to have increased from 32 to 34 percent. Concern among the young 18 to 35 years old, is estimated to have increased from 56 percent to 63 percent.
These statistics may help reveal some insights as to how travel businesses could tailor their products and services, even as they prepare for a restart.
How Various Travel-Business Vertical Flaring Right Now
Several businesses are involved in tourism and travel. Below, we highlight some of the most common. Here, we take a look at the nature of operation of the travel business, how COVID-19 has affected the travel businesses and steps they can take to better prepare themselves for a comeback given the data, and as the effects of the coronavirus begin to diminish.
A travel agency is a business that acts as a link between tourists and the industry. They mainly market packaged tours to specific destinations and commonly partner with hotels and car rental companies to offer services to tourists.
Travel agencies have had to deal with a huge surge in cancelled trips. Both domestic and foreign travel has been negatively impacted. But what is the way forward you may ask? Well, from the data examined earlier it is good to note that local travel will likely be the first to recover from the effects of the pandemic. Even though it may not be 100% as it was. Travel agencies should, therefore, be keen on offering packages well suited for local tourists. Corporate teams may also be seeking to regroup and re-strategize on the steps to be taken after the COVID-19 pandemic, therefore corporate packages should be given much consideration, ensuring the availability of conferencing facilities within the given hotels or resorts to be included within the package.
Destinations: Travel Agencies are also tasked with ensuring that destinations selected are safe for their clients. Despite the EU declaring that some of its borders are open for travel, this doesn’t mean that those countries selected are completely COVID-19 free. Clients may need to know how the virus affected the areas within the country or locality to determine whether travelling to some area may or may not be safe. Agencies should also ensure they base their information on credible sources, to avoid potential lawsuits from dissatisfied clients, as well as endangering their lives.
Health and Safety Precautions: Health and Safety will without a doubt be a huge concern for many travellers. The statistics outlined in the section Predicted Changes in Travel, show that there has been a 7% increase in concern of contracting the coronavirus especially among young travellers. This may remain long after the effects of the virus begin to subside. Travel agencies should, therefore, be keen in terms of the Hotels selected, means of transport and selected destinations. Measures such as social distancing, limits on gatherings, and sanitization may still be observed by travellers, whether or not they are enforced by authorities especially when visiting foreign countries. Therefore, Agencies should be keen on partnering with an organization that takes into consideration such measures to boost their credibility to customers and also stand out from the competition.
Employment: In terms of employment, travel agencies may still be advised not to be quick in restoring all their employees. It is unfortunate that despite the tourism industry being one of the worst affected, it is also one of the industries that will take the longest time to recover. Therefore travel agencies shouldn’t be too eager to re-employ costs should be cut down both now and later as things begin to normalize. Other costs that can be considered as unnecessary such as maintenance fees, unnecessary advertising, and components of the business not considered as part of the main functions should be carefully looked at to ensure that the business saves as much as it can in preparation for the post-COVID-19 season.
Pricing Packages: Due to the negative impact of the virus, many agencies may be tempted to set high priced packages to try and make up for the lost revenue. However, this would not be a wise move as travellers may still be very economical in their expenditure and the competition would know this too. The best way to approach this would be to offer packages that are very economical both to the travel agency and clients. Travel agencies should also take advantage of offers made by some tourist destinations and governments, to encourage tourism. For example in Kenya on 3rd July 2020, the Nairobi National park slashed its prices by 50%. Agencies could well partner with such destinations to get a huge cost cut and at the same time make some decent earnings.
Technology: Most travel agents may not have the privilege of operating fully online as Online Travel Agencies do. However, they should make the most of technology both now and during post-pandemic times to better reach out to their customers. Travel Agencies can do this by setting up video conferencing facilities to enable them to interact better with their clients, even as the social distancing measures and travel restrictions are in place. Video chats have also been proven to lead to higher conversion rates and therefore they are guaranteed to offer great returns on investment.
Travel Agents: Travel Agents are among the greatest assets of many travel agencies; they interact directly with many clients as representatives of the Travel Agency. With the limitations of COVID-19, it may be easy to consider their roles as redundant. However, with the use of technology, travel agents could play a vital role both now and post COVID-19 in both acquiring and offering consultation to their clients.
Online Travel Agencies OTAs
Independent travellers commonly make their booking flights, hotel reservations, tours, and access other travel services through OTAs. Online Travel Agencies, Commonly integrate accommodation and transportation. One of the largest is Expedia.
Online Travel Agencies already have an advantage of a strong online presence and they may be given the priority by many Fully Independent Travelers (FITs) that are seeking information, offers, or packages on some travel destinations.
OTAs should most definitely take the same measures as Travel agencies when considering partnerships with Hotels, car rentals, and other stakeholders in ensuring that client safety is a priority. This will enable your agency to gain credibility among the clients.
Also a good step for OTAs currently that would go a long way in promoting their brand names would be providing up to date information on how the Coronavirus would affect travel, safe tourism destinations even as some countries in the EU open up, and any other relevant content to keep in touch with their clients and also potentially.
Tour Operators offer trips as packages to travellers. They work closely with hotels and tourist attraction sites. Tour operators mostly operate within a country. In the post-pandemic period, tour operators should consider offering favourably priced packages to their clients, due to the predicted slow but gradual comeback of the industry.
Tour operators will also be expected to ensure high standards of health and safety, within their organizations, and also as they handle their clients. Destinations selected for tours should be properly scrutinized to ensure the safety of their clients.
Tour operators will also need to have adequate information on the state of the pandemic within certain areas before the creation of certain tours. This is because in many countries all around the globe, states and cities were affected differently by the coronavirus and while some may be deemed safe, others due to the nature of congestion among other factors may not. This information should be obtained from credible sources and presented to the clients to boost their confidence. Tour operators can also partner with travel agencies and resorts that are offering significant discounts to both lower their costs and offer desirable tour packages to potential clients.
Destination marketing organizations can be considered among one of the most credible sources when it comes to determining the safety of travel. Many tourists would be seeking information on safe destinations to travel during post-pandemic times. DMOs can play a critical role in the revival of the Travel industry through the promotion of local tourism destinations that can be considered safe to travel. They can also market special offers among other incentives to better promote hotels among other industry stakeholders.
Alisa Wolfson. A travel agent with over 40 years’ experience says the coronavirus is causing a cancellation surge ‘in a way I’ve never experienced’. (Mar 11, 2020). https://www.google.com/amp/s/www.insider.com/coronavirus-affected-travel-industry-veteran-cancellations-anxiety-2020-3%3famp
Seth Borko. Assessing the Coronavirus damage to Online Travel. (Apr 9, 2020). https://www.google.com/amp/s/skift.com/2020/04/09/assessing-the-coronavirus-damage-to-online-travel-new-skift-research/amp/