Summer 2022 Travel: Opposition and Opportunity
Travel & Tourism
Remember those high school science classes in which a teacher would encourage you to pour a test tube filled with one liquid into a beaker filled with a different one? Remember how you covered your eyes, despite the fact that you had those bad-fitting plastic goggles on that were supposed to protect you, but you couldn’t help but squint through your fingers anyway? Remember the anticipation of what might happen when the two liquids combined? Would it explode? Would anyone get hurt? Would it fill the room with smoke and kick on the sprinkler system? No one seemed to know, not even the teacher, which only heightened the tension and anticipation and excitement.
Ah, high school, amirite?
So with that image firmly in your head, we welcome you to this month’s edition of BVK Travel Insights, and invite you to take a metaphorical journey with us.
In one hand we have a test tube, and in the test tube are all the millions of people who’ve been locked down in their homes for two years due to the pandemic, all the people who have money to spend and pent-up desire to hit the road and be somewhere – anywhere – but their own house. Per the most recent Longwoods Traveler Sentiment study, demand to travel remains near pandemic-high levels, with 90% of American travelers saying they have plans to go somewhere in the next six months. Suffice it to say, the liquid in that test tube is YEARNING to get out, craving a mix and a mingle, needing to spend some money and explore new things.
However, waiting for it in the beaker are rising gas prices which are causing higher costs across the board for pretty much everything, on top of an economy already impacted by the highest inflation in 40 years, compounded by a war in Ukraine that’s further raised global tensions and gas prices, and also thousands of hospitality jobs that remain unfilled.
As travelers head into this coming summer, do any of them know what will happen when the former is poured into the latter? Can any of them predict the impact when the desire meets the reality, when the proverbial hard place runs smack into the proverbial rock? Nope. No one knows, but in this issue of Travel Insights, we offer up some perspective on what’s coming – and how you might prepare for it.
So without further ado, let’s dive into it. Or, rather, let’s pour into it.
First, the test tube. As noted above, the desire to travel is latent and pent-up. People want to get out, and they are thinking and planning accordingly:
- 95% of travelers have a road trip planned for the next year. – Longwoods International Travel Sentiment Study
- 47% of adults said they intend to buy trips and vacations in the next 12 months in February, compared with 40% in the same month a year ago. – Morning Consult
- 41% of American travelers agree now is a good–or very good–time to spend on travel and 62% continue to say that travel will be a high budget priority over the next three months. – Destination Analysts
But then, the beaker. Where that pent-up desire runs smack into the realities of the pocketbook and marketplace.
- Expectations to travel more (36%) and spend more on travel (37%) this year compared to last year have both dipped. – Destination Analysts
- Adults earning less than $50,000 reported a decline in travel intentions in February compared with January. – Morning Consult
- Airfares were already up 13% annually in February but, due to a combo of surging demand and higher oil prices, airlines plan to raise prices even higher this spring and summer. – Morning Brew
- Almost half (45%) of drivers said they were shortening driving lengths to cope with rising gas prices, according to one recent poll. – Marketwatch
- 2.1 million leisure and hospitality jobs are still missing compared to February 2020’s jobs levels of 16.9 million.– US Travel Association
That beaker, man, it’s a killer.
There’s an African proverb that says, “For tomorrow belongs to the people who plan for it today.” And then famed consultant and business strategist Peter Drucker kind of modernized it by saying, “The best way to predict the future is to create it.”
In that spirit, we offer the following insights and suggestions about ways that DMOs might capitalize on (and benefit from) the way traveler behaviors are changing due to the clash of the desire and the reality.
- Value: How can your destination provide more value for travelers, knowing they’ll be spending more to reach your destination but might have fewer dollars to spend once they get there? Offer experiences that offset the increased cost of getting to the destination or other. For example, waive hotel parking costs (DMO picks up costs as part of marketing budget). Point visitors to unique free experiences, concerts, and markets, etc. Ever heard of Sofar Sounds? Fantastic way to support local musicians + affordable ticket costs. Check out the spectacular and surprising venues they use from around the world here.
- Sustainability and environmental benefits: To support more eco-friendly travel, you can promote alternative ways to visit and explore – walking and biking tours, slow travel, localism, etc. Create incentives for travelers to visit and positively impact the environment; educational opportunities, etc. Maybe it’s a “gas-free” summer campaign or “instead of that, try this”, fun ways to experience the “old us vs. new us” destination. Use this opportunity to emphasize the importance of impactful and meaningful travel, getting travelers to think and act differently to support and build new/improved travel habits. Practice dispersing them to less well-visited parts of town that are more “up and coming.”
- Inclusivity: Consider ways to promote your destination as an affordable, viable option and go out of your way to welcome all travelers, particularly those who are impacted most by inflation and the high gas prices (lower HHI, families). Consider ways to incentivize low-income travelers, offer kickbacks or discounts. These travelers are arguably the ones who need travel most so how can your destination make it easier and more accessible for them? For example, hand out pre-paid gas cards upon checkout to those who drove.
- Destination Management: Important for destinations to use this year as the kick-off point for years ahead, particularly as many have been through reset and restart these past two years; set new rules/expectations of travelers, inform and educate, engage and support residents, ensure their voices are heard and contributing to destination promotion, management, and decision-making. Find ways through this new pandemic challenge/phase (inflation) to support localism, giving back to residents for staycations and destination support, and reinforcing to them the value of tourism to their local economy.
- Sense of Urgency/Planning: As prices increase and the looming unknown of the next wave/new variant could hit, travelers may need to take advantage of this window. DMOs can assist with planning, help travelers get ahead of the challenges, encourage travelers to come now, help meet traveler needs/expectations of what’s to come, etc. Capitalize on and leverage your social media following and email lists to push out topical information about “last-minute/exclusive” offers of things to do, discounts, etc.
At BVK, we’re helping our clients plan for – and create – their future every day, and we hope that the insights and suggestions here may provide a perspective on what’s happening with both the test tube and the beaker, and how you might best mitigate (or manage) the impact in your destination. If you have any questions, or just need a lab partner to experiment with, by all means feel free to reach out. We’ll bring the goggles.