Courtney Binkert
Team Manager SEA
We’re taking a look at the tourism industry, how it was hit by Covid-19, and what we can expect from travelers in the future. Based on these conclusions, we have a few tips on how to adapt advertising to the industry’s new audiences and altered consumer demands.
As we shift into a new normal provided for us by Covid-19, the tourism industry is facing an entirely new set of travelers. The GfK, Germany’s largest market research institute, suggests considering four stages when looking at consumer behavior. We will call them the following:
Travel behavior of consumers before, during and after the pandemic divided into four phases. Source: own representation
Starting Position and Panic
Before the pandemic started, travel and tourism had reached almost too-big-to-fail proportions, accounting for 10% of the global GDP. And though not as drastic, tourism made up almost 3% of Switzerland’s GDP in 2019. When the pandemic hit, the tourism industry all but came to a halt globally, and will continue to struggle for a few more years.
The World Travel & Tourism Council (WTTC) estimates that the economic effects of the pandemic will likely be five times higher than the impact of the 2008 global financial crisis. In key traveler markets such as the US, 10% of high-income households have experienced layoffs and cutbacks, and ensuing financial and affordability issues will negatively impact travel plans for the foreseeable future.
The New Normal
People are spending more time in their home country, fostering local trips and excursions. There are signs of switching to more energy-efficient transportation modes. Demand for walking or cycling is up, and in areas where lockdowns have been lifted, demand for bikes has increased tenfold. Trains are also increasingly popular. The WTTC suggests travelers’ focus is shifting to domestic trips, nature, and the outdoors, noting a slight increase in adventure and backpacking trips. Special activities such as visiting historic sites or touring by train are increasing in search volume.
International tourism, however, will likely feel the negative impacts of the crisis for much longer. Ready availability of transportation as well as social and economic fallout will further affect the industry’s recovery. The consensus is that global tourism receipts are not expected to recover to 2019 levels until 2023 at the earliest, more likely 2024. Most people do not feel comfortable traveling. Flight cancelations are three times higher than before the pandemic. There is a significant shift from air travel to personal vehicle travel. And those who do still fly now wait to book their trips until closer to their departure dates.
There are also more hopeful voices for a faster-than-expected recovery:
- Since gaining control over the infection rates, China’s air traffic has returned to 90% of pre-pandemic levels.
- Survey respondents said that they would spend more on trips and stop “putting off bucket list” travels. There is a need to catch up on a lost year of travel.
- Those who say they intend to travel more in the next twelve months are likely to be young.
The exact timeline of the recovery remains speculative, as the unpredictability of 2020 is likely to continue throughout the first half of 2021. With the vaccine being introduced, we will soon shift into phase four, The Next Normal.
The Next Normal
The need and want to travel remains strong across the globe, and willingness to travel is slowly increasing again, thanks to better understanding of the risks, safety measures, and pent-up demand. However, the pandemic has caused a behavioral shift in consumer demands, expectations, and needs – all of which need to be reflected in advertising.
Demand for mass tourism has given way to less crowded tourist destinations, in particular for rural and nature tourism. Nature and wellness/wellbeing tourism, in particular, are seeing strong demand due to a need to recover from the stress and trauma of the pandemic, whereby sustainability plays an increasingly important role. Travel will likely disperse across various months, increasing off-season tourism too.
Additionally, due to the pandemic’s economic fallout, travelers are pulled between their desires to see the world and to save money. For travel companies this means three things:
- Set your short-term focus on the two target groups most likely to travel, the ultra-rich and the young adventurers, and focus on these in your marketing activities.
- Consider the consumers’ need for flexibility by enabling changes and cancelations more than was done before the pandemic, and don’t be shy about promoting this aspect.
- Increase efficiency, and let your customers know you are their one-stop shop for all travel needs.
And Now?
Research shows that there is an accelerated behavioral shift among consumers for the travel industry, predominantly regarding safety and health, nature tourism, wellness and wellbeing, and financial means. Adapting global advertising strategies to adjust to this new behavior must now be a priority. If possible, tourism companies need to adjust their digital platforms to fit into this new fast-paced, short-term planning behavior. For those who already have services and platforms that cover new travel behaviors, highlighting these is key:
- Utilize various digital channels to push for awareness of services, to share updates on safety precautions, and to highlight special offers. These messages can grow reach, and they show users that their needs and wants are being taken care of.
- Make your response to the pandemic’s difficulties your interim Unique Selling Point.
- Highlight any services that are easy and safe to use during the pandemic. Think “How can I show the customer that I can still serve them?”
- In text, clarify that you understand your consumers; it can be as simple as telling them they deserve to spoil themselves.
As these behavioral shifts as well as lockdowns and openings are happening at staggered times, localizing these global strategies will be key. This means localizing customer interests, prioritizing activation timing, and updating ad copy to the needs and wants of the Next Normal tourist and the precautions in place for their safety, rebuilding trust, and highlighting unique product or service aspects that can establish companies as trusted one-stop shops for tourists of all kinds.
