Unless you have been living under a rock for the past week, you know about the Coronavirus or COVID-19 virus that has been causing concerns across the globe and affected the stock markets in a way we have not seen for many years. A few weeks ago, I suggested that no one panic. Well, is it time?
Not really…with a “but.” First some facts:
- In the past 4 days, confirmed cases of COVID-19 virus have risen globally from 82,164 to 85,688, a 4.29% increase.
- In the past 4 days, fatalities from the COVID-19 virus have risen globally from 2,801 to 2,933, a 4.71% increase.
- In the past 4 days, recoveries from the COVID-19 virus have risen globally from 32,872 to 39,761, a 20.96% increase.
Source: This cool dashboard that combines stats from various reputable sources.
At the time of this writing, the bad news is that the virus is still spreading. The bad news is that the mortality rate is increasing. The great news is that recoveries are leaps and bounds ahead of mortality. The good news is that the virus is still largely impacting China and the US (at this time) only has 66 confirmed cases and no fatalities. One of those cases appears to not have been connected to China. Further good news is that the federal and local governments are proactively reacting to this potential threat.
Unfortunately for the travel industry, these facts may have little sway when it comes to appeasing jittery clients. Absent a rush of people looking to travel to Antarctica (the only continent with no reported cases), our clients are nervous—and rightfully so.
- Will I get the virus in my destination?
- What if someone on my plane has the virus?
- What happens if a border is closed?
- Will I be able to get back to my family?
All these are valid questions and concerns to which we cannot (and should not) provide answers. People are jittery about travel and being in places with many others. Many will look to cancel their trips and here is where we can help.
For those that purchased travel insurance, do not assume that a cancellation because of the COVID-19 virus will be covered. Likely it will not. Fear of an event is not a covered reason. All insurance carriers have specific criteria for coverage and typically it is pretty stringent. The exception might be if there is a “cancel for any reason” aspect of the coverage. Please make sure you are aware of the coverages of the policies you are selling. Absent insurance, many travel suppliers (also facing a significant financial impact) may be willing to offer some waivers and favors for your clients. This is where your preferred supplier relationships will come into play. If they are not willing to cancel and refund, ask about a postponement until after the risk subsides.
The other aspect of this COVID-19 virus issue is one that has its origins not in Wuhan but on Wall Street in New York. The ripple effect from this virus has taken a toll on the stock markets in the past week and people are likely to be very concerned about money—present and future. Similar to a recession, people will pull back on their spending—maybe we can call this a micro-recession.
So, what to do? Keep informed is the first line of defense for your business. Make sure you are aware of what the CDC and the State Department are saying. Make sure you are aware of supplier’s policies. Keep an eye on the news and find out the information (or disinformation) that the media is putting forth to the masses. Guide and counsel your clients in making their decisions for present and future travel. Without knowing the depth or duration of this latest virus, as a business owner, you need to keep an extra close watch on expenses and make sure that you are spending your marketing dollars wisely.
Stay in touch! Do not pull back from marketing because you want people to remember you when this passes. But I’d question any marketing spent to highlight Asia and parts of Europe until we see where this is headed. Focus on destinations where the virus is not prevalent. And finally, keep in mind this has the possibility to become a protracted issue, so keeping tabs of general expenses will be key as well.
Like SARS and the rest, this will come to pass and we will have survived yet another curveball thrown our way. The agencies that deal, excel, or thrive during these times are the ones that are keenly aware. Keep your eye on the ball.