Author: Katie Briscoe, President, MMGY Global
As many of us continue to lead lives sheltered in place, the simplest of travel activities seem fantastical. The early morning airport drive to catch a flight, the unpacking and repacking, the inconvenience of TSA, even the dread of a middle seat or the never-ending conference session – you know, none of it seems bad now.
Travelers everywhere now mourn the loss of freedoms associated with these journeys, never having considered they took them for granted. During this time, something else has been happening too. In this shared human experience of a global pandemic, perspectives have shifted giving reason to believe that it will change the mindset of travelers in a variety of ways.
Right now the questions of recovery in travel are rudimentary. When will travelers feel safe to step on a plane? When will hotels welcome guests again? When can people again attend a convention, celebrate with family, or visit a dream attraction?
Rudimentary certainly doesn’t suggest unimportant. These questions, and so many more, are critical to putting the second largest industry in the world back in business – an industry that provides jobs to a significant portion of the global population (1 in 10 to be exact).
But an important question for travel suppliers and destination management organizations (that isn’t getting nearly enough attention) is whether consumers emerging from the era following COVID-19 will be the same travelers we have served before.
It’s unlikely.
To be effective brand marketers, we must understand the evolving psyche of travelers. We must engage them both as they transition from those who are currently just dreaming of their next trip to helping them make the leap of selecting a destination and then, eventually, facilitating their booking.
So as we work to recalibrate marketing programs and messaging, what should we keep in mind about travelers who have certainly been transformed by a new world experience?
Travelers’ perception of safety won’t be entirely rational for a while.
In the most recent wave of the Travel Intentions Pulse Survey (TIPS) conducted by MMGY Travel Intelligence and sponsored by the U.S. Travel Association, travelers say they now feel safest in personal vehicles and least secure on cruises and international flights.
Although cruising and long-haul air service are statistically much safer than transport by personal vehicle, the transmission of COVID-19 has polarized consumers’ perception of safety and informed a shift in their decision-making.
As the pandemic moves toward containment, infection rates drop, and travel suppliers transition extensive cleaning procedures into standard practice, there will be a period of time that people just feel safer controlling their own experience. Whether that be in their car, around friends and family, or just back in trusted and familiar places, this represents the beginning of travel recovery.
While we expect this fear to subside over time, as it has with past crises like Zika, Ebola and swine flu, we anticipate seeing many Americans begin their summer travel closer to home and slowly expanding their trips to longer-haul over time. With the economic aftermath of COVID-19, these road trippers staying closer to home becomes a massive opportunity for destinations that will rely on this crowd to fuel recovery in their communities.
There is no doubt that flyers will fly again and cruisers will cruise. Bravo to those travel suppliers who are using this time to develop plans for transparent messaging to educate consumers on safety precautions being taken during and after COVID-19. Trust is surely the way back into a consumer’s consideration and wallet.
While many are physically apart, family units are closer than ever.
As of last week, 316 million people in at least 42 states (plus the District of Columbia and Puerto Rico) were asked to stay at home.1 This represents 95% of the U.S. population.
We are not a country that holidays for weeks on end, so many of us are spending more time with our families than perhaps ever before. Of the respondents in our TIPS survey, nearly 70% of confirmed leisure and business travelers say they currently have children in the household and almost 80% say they are living with a spouse or partner.
Spouses are learning to co-work in what have become two-office homes, and parents are juggling professional responsibilities with those of educating children through the end of canceled school years. While these jumbled duties naturally add stress, they are also forcing families to reprioritize and become far more present than modern society has previously permitted.
When the time comes for “normal life” to resume – we go back to the office, take on business travel again, and kids head back to school in the fall, there will be a demand for family vacation experiences. This is especially true for those close to home that connect the dots between this strange chapter in our lives and the inevitable longing to spend this much time with one another again.
And while Zoom, Skype, FaceTime, and even apps like Houseparty have connected many of us that palpably miss our extended families and other loved ones, brands now have the opportunity to play an important role in creating renewed connections. Perhaps one of the most heartbreaking aspects of this global pandemic are the celebrations that did not take place. Expect multigenerational trips to be in demand as well as an added emphasis on experiences that enhance human interaction. This will be a solution for extraordinary pent-up demand as we emerge from this situation together. For many destinations and hotels, this market opportunity can replace the large association and corporate group business unlikely to return until Q4 or 2021.
Value will be expected, but it’s not going to be enough.
As consumers prepare to purchase travel in this economic climate, there is no question they will be seeking value. It is estimated that 40%–50% of discretionary consumer spending might not be spent this year.2 Entering the crisis, 32% of American leisure travelers cited price as their primary consideration when booking, so those precious household discretionary travel dollars will be carefully considered.
But before we head straight to rate and fare cutting (tactics that elongated The Great Recession by slowing revenue recovery for travel suppliers), let’s talk about how we can demonstrate value to consumers following COVID-19 without deep discounting. And perhaps most important is ensuring we make travelers feel emboldened about the money they do choose to spend.
Staying connected to customers in a period when they aren’t well-positioned to spend is a commitment that presents a long-term value proposition. It’s natural to consider dialing back marketing communications when consumers aren’t booking or buying in traditional purchase windows. But when they do return to previous patterns, what reasons are you providing for them to return to your brand?
Commercial airlines are perhaps the most relevant example. After the initial shock of “airlines that are famously inflexible being very flexible right now,”3 we saw Delta grant unprecedented extensions to its Skymiles members. Delta CEO Ed Bastian announced a policy shift that allows customers the ability to plan, re-book and travel for up to two years – strategy born outside of fare reduction that not only builds loyalty but undoubtedly steals market share.
Providing new and low-cost amenities to booking packages can also enhance value. Cleaning items, creative thank you content, information about new operational philosophies, or asking line-level staff to engage travelers in new ways are all plusses. These can be particularly important as part of loyalty programs and for retaining best customers, which is where we would suggest suppliers begin their communications efforts.
Because of the economic and emotional hardship facing the world today, consumers also expect their money to do more. People stuck in their homes need something to look forward to, and a future getaway fits the bill. But consumers will seek to spend in a way that makes a difference in public health and economic recovery of the world, too. Traditional retail brands quickly jumped on the bandwagon of shopping with a purpose during the pandemic, both as a way to help and in an effort to keep their brand relevant.
Nail polish brand Orly reconfigured its Los Angeles factory to produce hand sanitizer spray to meet consumer demand, with the first 10,000 units being donated to LA’s at-risk homeless population. Comfort shoe brand Allbirds also launched an initiative to support the health care community while lifting sales through bundling purchase with a donation. Both of these examples strike an authentic tone in that it is both self-serving and selfless.
Travel brands and suppliers should strongly consider joining in on this “Battle of the Good Guys,” developing ways to reactivate business and contribute to a greater good that connects consumers and communities to a bigger picture.
This month, MMGY Global is working with HSMAI to launch a turnkey promotional solution designed to generate immediate revenue for the hard-hit hotel industry. This “Buy One, Give One” concept incentivizes a guest to book a future stay in a vacay layaway promotion that incorporates a charitable gifting component for frontline healthcare workers. This gives consumers an opportunity to give the gift of rest and relaxation for those working so tirelessly to fight COVID-19.
When ideas like this are well-executed, everyone can and should win.
Sustainable business practices will become even more important to consumers.
Many see the impact of this global pandemic as an opening act for the broader issues facing our environment. In fact, an internet meme that successfully made its rounds suggested that “climate change needed coronavirus’s publicist.”
Forbes contributor Roddy Clarke said, “Over the last 70 years we have perhaps become accustomed to a life of convenience. We have endlessly increased industries each decade to support our ever-fulfilling lifestyles. Did we think we had the right to continue this incline forever? On a planet we are privileged to call home, but a finite resource none the less.”
Prior to COVID-19, MMGY Global’s Portrait of American Travelers® study reflected year-over-year revenue growth for brands demonstrating environmental responsibility. Over 1 in 4 travelers said they were intentional in booking trips with environmentally friendly hotels and tour companies, and 32% of travelers said they were willing to pay higher rates to these brands.
Travelers are also hyperaware that the state of the environment will impact their ability to travel the world over the next five to 10 years. Over half of travelers in our study say that climate change would play a significant role in the destinations they visit.
Again, this was before COVID-19.
Sustainable practices will become more important to consumers as direct correlations are drawn to the cause and effect of this global pandemic and the issues facing our environment. Jason J. Czarnezki of The HiIl said, “The world’s current handling of the coronavirus pandemic – an imminent threat spreading rapidly across the globe – offers lessons to turn around the stark lack of global action toward the climate crisis.”4
If you’ve already committed to sustainability as a pillar of your business practice, double down. According to the Portrait of American Travelers®, those who made a purchase based on social concerns spent 39% more. Not only is it the right side to be on, but it’s one that will pay off in economic return.
If you have not embraced these principles, now is the time to re-examine business plans, explore strategic partnerships and work to strike a more equitable balance between our planet and its global citizens. COVID-19, if it produces no other long-term shifts in mindset, will demand of us all a more thoughtful approach to our vulnerabilities and precious resources.
We must pay close attention.
Very few could have imagined how quickly our day-to-day lives could change and especially how travel would be so dramatically affected. It was hard for any of us at MMGY Global to imagine a world in which people were asked to stay at home. It has been singularly unique in modern human history.
For brand marketers it is now crucial to understand that human beings have changed, perhaps not just in the short-term, but in more meaningful, long-term ways. As travelers, suppliers and industry influencers re-emerge, it will be wise to recognize that their tone and approach must change too. Speaking to people with an empathy around their changed lives will allow human connection that produces revenue, forming a symbiotic partnership in marketing that is likely necessary in our new social landscape.