By Angela Burtch
Perhaps no industry has been as devastated as travel has been in 2020. Domestic and international travel have both plummeted precipitously. According to the IATA (International Air Transport Association – the gold standard association that collects air traffic data), passenger traffic was down more than 86% in June from the same month a year ago, following a drop of 91% in May. Behemoth travel companies like AirBnB had to reduce their workforce by 25% within weeks of the onset of the pandemic reaching the USA.
The uncertainty of Covid-19 spikes make travel a nightmare; people left stranded with no flights home and facing quarantine when they do get there is no nightmare. It’s reality. No wonder leisure and business travelers are increasingly preferring to stay put or stay domestic.
So, how do our clients in the tourism/travel sector create strategies to prosper during these times and how does research assist in this regard?
1.There is a lot of confusion around the rules of travel, given the erratic nature of the pandemic: traveling party regulations, quarantine, and places that are simply not available to international or even within country travelers.
Making interactive tools/maps available to travelers to help them navigate the parameters for travel might be a useful tool for OTAs (Online Travel Agencies) to offer on their websites for bewildered travelers. Tools like this have been implemented by countries such as Canada, including interactive maps to allow travelers to navigate the parameters for travel. This allows users to input their departure/destination for an output of guides surrounding travel restrictions, COVID-19 bulletins, and other useful information for travel planning.
Qualitative and/or usability research could help design solutions that will better inform, prepare and motivate potential travelers.
2.Research we’ve conducted for USA tourism agencies in wine & beach regions indicates that there is a large share of wallet from in-state travelers. There is no better time to promote the benefits of staying local. In addition, OTAs are reporting other shifts in travel behavior including increased demand for rural stays and longer trips.
Market research can help identify how to segment these most likely domestic travelers and position the destinations to these travelers.
3.These are uncertain times (note: we didn’t say “unprecedented times”). Offering travelers flexibility with their travel arrangements buys peace of mind.
Market research can help identify those messages and purchase features that are most powerful to help travelers feel more confident about booking travel: book now/pay later, flexible cancellation terms, refunds, extending loyalty reward periods, etc. In addition, travelers are nervous. Providing specific information regarding how restaurants, hotels, and tourist destinations are implementing enhanced safety and hygiene efforts will bode well to comfort prospective travelers. For example, hard-hit Airbnb developed “Enhanced Clean Protocol”, which is a set of guidelines developed with medical experts to help hosts protect themselves and their guests.
4.Booking windows are becoming increasingly shorter (within a week of travel) as people monitor Covid-19 activity in the places that they are traveling.
Hoteliers will need to become creative so that discounted last-minute prices are not the only trick in the bag for revenue management. Offering value-adds such as free parking, breakfast, or upgraded rooms may go further with travelers and will not tarnish higher end brands becoming “low cost leaders”.
Discrete choice modeling can help hoteliers understand the optimal benefit set, aside from price reduction, to keep travelers coming through the door. A form of conjoint, this choice-based methodology tests which bundle of benefits a traveler would be most likely to purchase.
These are just a few ideas for managing change in the travel industry. Our team at Merrill Research has decades of experience in travel, tourism, and wine country travel. We’d be happy to meet with you to share our learning and offer-up research solutions as we reach the new normal.