New trends within the global travel market are rising at a fast pace while others keep decelerating amid the current uncertain environment. From customers’ demographics to the way vacations are taken, a transformation is happening in the sector.
Among crisis, there is always an opportunity for change. Therefore, an unprecedented disruption such as the outbreak of COVID-19 brings imperative alterations for the travel and tourism industry itself as well as for most of its stakeholders. Lockdown periods, travel restrictions and bans, quarantines, company bankruptcies… the list of setbacks is long. However, the global travel sector is characterized by its resilience towards numerous critical situations, from terrorist attacks to major economic turbulence.
A report from Euromonitor International highlights, among a wide variety of topics, both the tendencies and the evolution of the global travel market caused by the current challenging situation. On one hand, the document states the market aspects that are accelerating nowadays while on the other hand, those which are slowing down are also identified. Managers from every travel company worldwide should take a look at this report and add the information it displays to their organizational strategies. The elements outlined in Euromonitor’s document will mark the course of the travel industry for the coming months, if not years, and may transform the industry forever.
By taking a look at the report, it can be extracted from it that sustainability’s role continues gaining momentum. Most of the identified accelerating market trends are related to sustainable travel. From a remarkable growth in trips to nature sites to a proliferation of adventure activities and an increase in demand for rentals, eco-pods, and camping locations. Yet there is still more. According to Euromonitor’s research, sustainability is labelled as a decisive value proposition in the current travel market. Also, the report stresses the importance of balancing social issues with environmental ones. This presents destinations an opportunity to take advantage of.
The rest of the accelerating trends mentioned in the analysed report, although theoretically related to other topics, still have fit within a new and innovative sustainable travel industry. Changes are also taking place in terms of demographics, technology, and market segmentation. Luckily for the sector, these developments can be combined and integrated to adapt to a changing market and an increasingly demanding customer who seeks a tailored and sustainable approach when travelling.
Generation Z is driving this fast transformation. This cohort is formed by digital natives with large buying power and remarkable influence on household purchases who want to be the first of their associates to discover the world. Travel marketers agree that in order to attract Gen Z’s travellers, a more targeted and personalised approach is needed. As they are willing to spend more in experimental travels that engage them with local communities in sustainable ways, Gen Z poses a challenge for DMOs in terms of developing marketing strategies contrary to the mass approach. Travellers from Gen Z also present opportunities for destinations, particularly regarding boosting the levels of consumer confidence within the travel market in times of COVID-19.
Another cohort that is key to the recovery of the global travel industry is Generation Y, also known as millennials. This market segment is the largest living adult generation and is willing to travel sooner and take more risks than previous generations. Having been surpassed by millennials, baby boomers are identified as one of the decelerating market trends within Euromonitor’s report. Some of the factors that explain this situation include the fact that COVID-19 poses a major threat to the health of senior travellers, as well as the impact the pandemic has on traditional subsectors that particularly target baby boomers (for example, the cruise industry). In the same way as Gen Z, millennials are driving a deep transformation in terms of how destinations approach the travel markets. DMOs from various countries, from Greece to Norway, are starting to embrace indirect ways of promoting their nations through influencers and user-generated content communicated through platforms like YouTube and Instagram.
But not every element of the travel industry is experiencing growth. In fact, a major change in the sector’s model may be happening. The impact of situational factors, such as travel restrictions combined with low levels of customer confidence and a high degree of global uncertainty, are the main drivers of a transition to a different way of travelling. For example, the sector is experiencing remarkable growth in terms of staycations. Euromonitor’s study stresses the current fall of long-haul flights and mega cruises. Two elements that represent the core of mass tourism, a model usually labelled as unsustainable and that has been hit with force not just by the pandemic. Situations such as stopping the production of superjumbo jets like A380 or B747 or the liquidity issues that major cruise lines are experiencing pose a threat to mass travel.
There are things the travel sector should be optimistic about. As mentioned before, the accelerating trends in the global market need to be addressed and destinations should build on them. The goal is not just to recover the industry, but complete its transition to a more sustainable model. A key feature of the travel sector is its ability to adapt to adverse circumstances. World Travel Market has reinvented itself to reach the industry’s stakeholders with an innovative virtual format. Big companies keep adapting to the new environment by developing new digital elements that boost travel demand, relaunching brands in new directions, and investing in the needed skills for travel professionals in the new normal.
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