Where Are We Headed Next? | TravelResearchOnline

Image
Image

Where Are We Headed Next?

 

I’m so glad I took economics and history in college. My professors taught me two immutable facts.

1) Humans are creatures of habits – some of which are hard to break.

2) Given enough time and free moving capital, economies grow.

Now, some things change significantly as a result of a recession. And recoveries from financial crises don’t follow a common schedule. In many cases, changes, like the increase in healthcare costs we’ve experienced the last 30 years, or pro-longed stagnation of wages, leave a lasting mark that could change some of our habits.

But for the most part, humans don’t easily change, the globe continues to spin, and activities like travel grow. Which leads me to the COVID-19 travel recession.

 

 

More Than Cautious Optimism

Since I got into travel in 1987, every time we were told that some world event had “changed travel forever,” the world and the industry adapted – e.g. taking our shoes off at airport security checkpoints. The human love for travel resumed.

Currently, I see optimism playing out in the travel data I have been following since the beginning of this madness. First, let’s take a look at the Transportation Security Administration’s (TSA) checkpoint travel numbers. Through this Sunday, the rolling one-week average of total passengers processed has increased 1.6% week-over-week since the first week of August.

Now, that may feel pitiful to all of us who grew so accustomed to travel’s heyday, but can we please keep some perspective? We’re in the middle of a global pandemic. More than 20 million Americans are receiving unemployment assistance, and states and countries have imposed pretty severe restrictions on people entering their borders.

Through the week ending around Halloween, the weekly increase in passengers processed averaged around 1.4%. Considering how new coronavirus cases have shot up since Halloween, the fact that the number of passengers processed continued to increase shows how the human desire for travel is incredibly resilient.

This kind of data is the best indication of how Americans feel about the risks of coronavirus right now. But what about the future? Where are we headed next? For that, I have been tracking a different set of studies and data sources.

 

Short Term Prospects, Not So Good

Like I’ve said in previous columns, I don’t use these studies as precise predictors but, because they are showing us sentiment over time, collectively they give us a pretty good idea of where consumer travel buying habits are.

Let’s look at airline ticket purchases from the Airlines Reporting Corp (ARC), the weekly travel sentiment analysis from Destination Analysts, and the Harris COVID Tracker poll (which entered into its 39th wave just prior to Thanksgiving).

What these sources tell me is that we should remain “cautiously optimistic” about the near-term (12 months) prospects of Americans purchasing travel, and very optimistic about the long-term prospects that we will experience a new Golden Age of Travel someday.

Let’s take ARC’s data for airline ticket transactions first. (These tickets represent an average departure date of 25 days from date of purchase). Since the first week of August, airline ticket volumes for leisure travel agencies have grown on average about 1% each week through the end of October, while online travel agencies (OTAs) grew an average of 1.8% each week during that same period.

Then came November and the spikes in new coronavirus cases, slowing year-over-year growth. Leisure agents week-over-week growth slowed to 0.6%, while OTA growth slowed to 0.8% week-over-week.

Chuck Thackston, ARC managing director, data science and research, believes this slowdown is due mostly to more U.S. states responding to the rise in new COVID cases with stricter traveler quarantine restrictions. “When we start to see restrictions reimposed, people get nervous,” Thackston said. “What you see in the daily news headlines is going to impact consumer sentiment and travel behaviors.”

Also, he noted, Thanksgiving fell a few days later last year — so week to week comparisons are off slightly.

You can see Thackston’s theory come alive in the latest results from Destination Analysts’ weekly Coronavirus Travel Sentiment report. According to the report released November 24, the percent of Americans with tentative plans to travel before June of next year is down about 13.5% from the previous week.

Some 56% of respondents to the survey either agreed or strongly agreed with the statement that they would not be traveling again until “the Coronavirus situation blows over.”

 

Long Term Prospects Are Good

Still, encouraging signs for the long-term return of travel remain. According to the Harris Poll, overall long-term sentiment about flying in planes, taking a cruise, and staying in hotels immediately after the curve has flattened has stayed relatively stable. That’s astounding given the recent COVID headlines.

There are some significant anomalies in the Harris Poll’s number of respondents who say they will never cruise again (rising from 16% in late October to 22% in November), but that could be a matter of respondent sampling. No other form of vacationing had such a large shift between October and November.

Travelers do appear to have some concern currently about casinos, with fewer respondents willing to visit a casino immediately after the country declares the curve has flattened, shifting their booking patterns to 4-6 months out for that kind of vacation.

 

Wear the Dang Mask

Like I have been saying since the very beginning of this pandemic, “The Virus Drives the Narrative.” If we don’t get this thing in check, provide widespread access to vaccines, and commit to personal physical distancing responsibility, all bets are off.

We have a collective stake in getting America’s economy going again. Playing politics with stimulus packages, standing idly by while millions of Americans are evicted from their homes, etc., etc., will only serve to hurt the travel industry.

If we don’t do each of our own parts to protect our neighbors, ourselves and our communities, we will push that “Pent Up Demand” further out into a very distant future, destroying tens of thousands of small businesses, and causing unnecessary human suffering. I’m cautiously optimistic Americans won’t let that happen.

 


Richard D’Ambrosio is a master storyteller who, for more than 30 years, has helped leading brands like American Express, Virgin Atlantic Airways, the Family Travel Association (FTA), and Thomas Cook Travel tell their stories to their customers, the media, and employees. A professional business coach and content marketing consultant with his own firm, Travel Business Mastermind, Richard most recently has worked with The Travel Institute, Flight Centre USA and a variety of host agencies and tour companies, helping entrepreneurs refine their brands and sharpen their sales and marketing skills. Richard writes regularly about retail travel agencies, social media & marketing, and business management.

Share your thoughts on “Where Are We Headed Next?”

You must be logged in to post a comment.







Image