How can the travel industry take the global crisis as an opportunity to accelerate innovation?
Caroline Bremner, Head of Travel Research at Euromonitor International, will share insights from their last research, providing a unique perspective on the great opportunities for tourism organisations and businesses in the field of innovation.
How can the travel industry take the global crisis as an opportunity to accelerate innovation? Caroline Bremner, Head of Travel Research at Euromonitor International, will share insights from their last research, providing a unique perspective on the great opportunities for tourism organisations and businesses in the field of innovation.
As part of a series of research talks on X. Rebuild, we are seeking to gather as much data and insights as possible to help us better respond and plan for the future. In this in-depth interview, we will be looking at some of the key findings in the report, of what is an ever-changing picture, with continuing uncertainty.
So with everything considered, what are the factors which will define our ability to rebuild out of the current situation, what role will innovation play in identifying new opportunities and adapting to new realities and how can we prepare ourselves for a stronger and more sustainable future, remaining resilient and agile in doing so.
Accelerating Travel Innovation after Coronavirus: From Tragedy to Hope
Covid-19 is a human tragedy and its effects on travel and tourism are multi-faceted. It directly impacts families devastated by grief, workers that have lost their jobs or are on furlough, while indirectly impacting local businesses due to tourism’s multiplier effect.
Without doubt, Europe has faced one of its darkest hours post-war, with the reality of a second wave leading to new lockdowns across the continent. With the EU opening up over the peak season, there was some initial respite but not without challenges, as rules often changed, leading to a chaotic system.
Domestic expenditure in Europe was the relative winner, forecast to decline by 24% in 2020 compared to international receipts (down 54%). Some sectors like intermediaries may take several years to recover. The region faces a deep recession with GDP to fall by 9% in 2020, with the EU providing €1.8 trillion for the COVID-19 recovery plan, and to meet the goals of the Green Deal as part of its sustainable, digital transformation.
Responding to the global SOS, travel brands are jumping on innovation to future-proof recovery post-COVID-19. Innovation is taking multiple shapes as digitalisation and sustainability accelerate and converge. New source markets, consumer segments, business models and alternative revenue streams are just some of the strategies being explored to ensure survival.
Converging Pillars of Travel Innovation after Coronavirus
Visitors — the lifeblood of the tourism economy — disappeared in 2020, forcing European destinations to go back to first principles. Reinvention through VR/AR was popular. To continue engagement with potential visitors, Egypt, Uganda and South Africa have launched virtual experiences including virtual safari tours thanks to live streaming. Destinations have turned to their residents, offering apps to discover “off the beaten path” activities and tours.
The digitalisation of the customer journey has continued apace, with AI and automation deployed to iron out pain points. Mobile apps have provided greater transparency to consumers about their travel impacts such as Meravando in Germany, enabling carbon offsetting for cruises. In Argentina, the Imagine Initiative is a very simple but effective idea of a Green Passport, encouraging consumers to track their carbon footprint.
US travel businesses expect increased usage of AI at 61% over the next five years, 57% will introduce Internet of Things, and 25% aim to leverage robotics, according to Euromonitor International’s Voice of the Industry Survey, Travel (April 2020).
Buoyed by Asia Pacific’s income potential, recovery prospects are comparatively optimistic. Tourism demand (international and domestic) is expected to return to pre-crisis levels within three years. Growth will be spurred on by value for money products such as short-term rentals and low-cost carriers which are predominantly booked online or via mobile.
Most travel innovations in the Asia Pacific are infused with digitalisation, tackling a variety of different needs related to COVID-19, such as a safe and contactless customer journey, mobility, sustainable destination management and virtual experiences.
With the travel industry in dire straits, the urgency to innovate, digitalise and look even beyond sustainability is ever more critical. The need for radical change is amplified by the growing number of voices speaking as one across government, activist investors, NGOs, consumers and businesses. The call for a planet-conscious mindset, a green recovery and sustainable transformation has never been louder.
For full insight, download a complimentary copy of Euromonitor International’s report Accelerating Travel after Coronavirus.
Caroline Bremner manages the global content strategy for the travel and tourism industry at Euromonitor International, which she joined in July 1996. Euromonitor International is a world-leading market research company with over 40 years of experience.