Olivier starts by talking about the governments' expectations to use 'tools' to manage, activate and restrict travel as the virus changes and evolves.
We learn that the world can shut down in a matter of weeks but opening up cannot be done so fast.
The global recovery looks to be almost impossible as long as restrictions remain in place. What we can learn however is just how valuable travel bubbles can be.
Olivier Ponti starts by talking about the expectation of governments to use 'tools' to manage, activate and restrict travel as the virus changes and evolves. We learn that the world can shut down in a matter of weeks but opening up cannot be done so fast.
Nobody could expect a return to international travel whilst restrictions remain in place.
The global recovery looks to be almost impossible as long as restrictions remain in place. What we can learn however is just how valuable travel bubbles can be. The Russia-Turkey travel border is a perfect example of this with a huge reactivation of the industry with a travel bubble, triggering a sharp increase in flight searches, which ultimately turns into tickets and bookings.
Another great example of this is the travel bubble between Singapore and Hong Kong, releasing an immediate burst of demand. Once it was established and announced, they saw numbers which soared to almost a normal year on year growth. The rush to flight searches and tickets proves that people still want to travel and that they will travel as soon as they can do so.This gives us an indication of the level of pent up demand.
There are strengths and weaknesses in the travel bubble approach. It requires confidence to come with it and the cautious approach can also erode on consumer converted, so ultimately there is still the requirement for governments to act fast and hard on vacancies and measures which keep people safe and rebuild trust.
Advocacy is hugely important.
What we know from this crisis is that what you thought you knew is no longer valid. Countries open and close overnight and the same is the case for businesses. This ever-moving and shifting landscape can be quite disorienting but it is only now progressing towards its senses.
China, Russia and Brazil have returned to its pre-pandemic levels for Domestic travel which is a real signal of hope for everyone. Furthermore, if we look at the USA and Mexico, we continue to see year on year ticketing growth to destinations like Cancun, which is quite a surprise but points also to the competitive advantage and the fact that other destinations remain closed.
Tickets issued from international travel went from 54% share of the market to just 38% in November and it demonstrates the fast-changing nature of the market.
In the USA, Thanksgiving shows us what's happening in terms of recovery. We've seen 75% of the previous year bookings which is quite incredible given the current circumstances, but last-minute bookings will remain the norm as confidence and concerns over restrictions mean people leave booking until the last minute.
We know that safety is something that the industry must prioritise. The perception of safety is influencing the way people travel and the itineraries they take. Connecting flights through international hubs or example are suffering a slower reactivation than direct flights. This suggests that people are avoiding stopovers and prefer flying direct to their destination wherever they can, which puts destinations with limited connectivity in a difficult position.
Since the beginning of the crisis, air connectivity has suffered greatly. Scheduled capacity to Europe peaked at 41% in August and went back to 23% of 2019 volumes as restrictions came into place. One stimulus for this has also been huge reductions in airfares and on the other hand airlines may struggle to rebuild route networks and capacity according to changing demand at such speed. Re-building international air connectivity will be particularly important for DMOs, which will be forced to rethink how they work with the trade and industry.
Thinking about the future is something we must stay focused on, or we'll miss the boat by focusing on the recovery alone.
Prepare for it as if you're getting ready for a marathon, it's a journey where we need to think about those bigger questions, such as how sustainable you want to be, which partners align with your brand and where do you want to go as a business. Volatility is also something we need to be prepared for, so being agile and adaptable is key.
Data has now come into its own. Before this crisis, there was a lot of talk of data but little real leverage of it but now we see that the value of real-time data has never been as important. Whilst not losing sight of your strategic objectives, keep an eye on the tactical opportunities too.
Rebuilding tourism is going to be tough but it is our opportunity to address major issues and rebuild better.
Lastly, maximising the tactical opportunities requires the empowerment of in-house analysis. It requires a mind shift from both analyses and the organisation and a readiness to quickly change gears as soon as the situation requires it.
1. Travel bubbles can be invaluable. Some have shown how people rushed to flight searches and tickets, prooving people still want to travel and will travel as soon as it is possible.
2. Governments are required to act fast and hard on vacancies and measures to keep people safe and rebuild trust.
3. People leave booking until the last minute, they want to avoid stopovers and prefer to fly direct to their destination wherever they can.
4. Be prepared for volatility, be agile and adaptable.
5. Rebuilding tourism is going to be tough but it is our opportunity to address major issues and rebuild better.
As the leader of the ForwardKeys Insights team, Olivier Ponti is one of the world’s most authoritative experts in travel research and destination marketing.