The AAA now estimates that in 2021 the airport will handle 582,895 RGPs, 46% of the total handled in 2019, in 2022 856,852 RGPs, 68% of those handled in 2019, in 2023 985,380 78% of those handed in 2019, in 2024 1,059,283 RGPs, 84% of the 2019 total and in 2025 1,138,729 RGPs, 90% of the 2019 total.
For 2021 the forecast has been adjusted downwards from 52% of the RGPs handled in 2019 to 46% of those handled in 2019. For the years 2022 through 2025 the AAA is confident that the airport will reach the projected percentages versus the year 2019. It should be noted that these percentages will vary as the years come closer and AUA Airport has much better insights into the recovery of its airlift for those years.
Revised Forecasts as of January 2021
As the travel sector eyes recovery in some markets while navigating fluctuating regulations in others, Google is launching a new suite of tools designed to help industry stakeholders make better data-informed decisions.
The search giant’s new website - called Travel Insights with Google - is built around three tools geared toward destinations, hotels and Google’s commercial partners.
The first tool, Destination Insights, is a public resource for governments and tourism boards that details top sources of demand for a destination, as well as the destinations within countries that travelers are the most interested in visiting.
With the data, destinations can map out possible resumption of travel on specific routes and decide where to communicate with potential future travelers.
The second public tool, Hotel Insights, packages Google hotel search data to help hotels - namely small and independent hotels - understand how to target their marketing as they plan for recovery.
In addition to real-time insights, it also includes a resource guide to help hotels leverage tools like Google My Business and Google Reviews.
The final component, available to Google’s commercial partners, is the Travel Analytics Center, which enables organizations to combine their own Google account data with broader Google demand data and insights. The insights will help travel partners manage their operations and find opportunities to reach potential visitors.
In an interview with PhocusWire, Richard Holden, Google vice president, product management for travel, calls the site a “one-stop shop for a number of different products and links.”
Although Travel Insights with Google will be available globally, the site is launching with a focus on Asia Pacific, where “lockdowns have worked well and COVID rates have gotten under control,” Holden says.
“We’re certainly not focused on trying to encourage travel at a time when travel may still be unsafe in various parts of the world.”
Holden adds that the new tools are an extension of other initiatives Google has put into place to help the industry recover.
“[Google] has been looking at what’s been going on in the industry, which has been unprecedented. … Travel is probably 10% of global GDP, and a massive amount of businesses depend upon this. We see estimates of 120 million tourism jobs that could be at risk across the globe,” he says.
“We spent a lot of time thinking about the data that we have, the data we’re able to collect and the insights we have from users as well, and what can we do to help the industry recover?”
On the consumer front, Holden says Google pivoted to helping travelers understand travel advisories as well as hotel and flight rates and refund policies. It also promoted “hero rates” to support first responders.
For businesses, in June, Google launched Flights Demand Explorer to provide search data to airlines. Holden says Demand Explorer data will be bundled into the Travel Analytics Center.
Amid the pandemic, the search engine has also heavily pushed its pay-per-stay program, which was in limited release prior to COVID-19. “What [pay-per-stay] effectively does is shifts the burden of cancellation risk to us at Google, away from hotels,” Holden says, noting that hotels and big OTAs like Agoda “have leveraged this heavily and found it particularly useful.”
Holden says there are no plans to pull back on the pay-per-stay program at this time, and there is no intention to discontinue Travel Insights with Google in the future – “to be honest, the data is useful for these businesses in any shape or form going forward.”
And, given the billions of dollars its travel partners spend with the search giant, Holden says Google is continuing to evaluate how it can add more value to its partners.
“I genuinely think we’ve been very helpful and we’re continuing to try and be as helpful as possible.”
NEEDHAM, Mass., Nov. 18, 2020 /PRNewswire/ -- Tripadvisor®, the world's largest travel platform, and Phocuswright, the leader in global travel market research, today jointly released the findings of a comprehensive new research paper into the shifting trends in global travel demand and traveler behaviors, charting the industry's road to recovery in the wake of the ongoing pandemic.
The report, entitled '2020 - A Year in Travel: Charting the Travel Industry's Path to Recovery', analyzes Tripadvisor's first-party data on travel planning behaviors around the globe, as well as consumer sentiment across six major markets, to provide a unique insight into global travel trends.
The full report can be read, for free, here:
Key findings from the report include:
After positive signs of recovery in domestic leisure travel over the summer, demand for accommodation is now falling back in a number of markets as infection rates rise
Europe experienced the strongest leisure travel recovery during the summer, with the number of travelers researching domestic hotel stays reaching 2019 levels of demand for a sustained period in late July and August. However, the recent re-introduction of lockdown restrictions in countries like France, Germany and the U.K. has seen demand for rooms drop
In the U.S., the domestic hotel recovery was slower but steadier than major markets in Europe. By the first week of September, domestic hotel clickers in the U.S. - likely driven by leisure travelers - outnumbered those in the same week in 2019
Signs of recovery in Asia-Pacific were less obvious across the region as a whole between June and October, though some markets - such as Singapore - saw a surge in demand for domestic stays
Confidence to travel remains fragile, but with big differences by market
Of consumers surveyed in six markets, confidence to travel was highest among U.S. respondents (48% said they felt more confident it would be safe to travel in the next three months compared to the previous three) and lowest among respondents in Italy (just 12%)
Travelers are reassessing the type of trips they want to take…
Two-thirds of consumers surveyed (65%) say the ability to avoid crowded places when traveling is now a more important factor in their choice of destination than it was pre-pandemic, and more than half (52%) say they are more likely to take an outdoor/nature trip than they were before the pandemic.
Between May and September, outdoor activities, nature and parks accounted for thirty-four percent (34%) of all attraction page views on Tripadvisor, up from 25% in 2019.
...and as a result, their choice of destination is changing too
Looking at year-on-year data over the October period, ski and seaside resorts, as well as other rural destinations, dominated the list of fastest recovering destinations in Europe for domestic accommodation searches on Tripadvisor, with Zermatt in Switzerland and Adler in Russia topping the list based on year-on-year demand
Over the same period, destinations like Key West, Myrtle Beach and Sedona were recovering quicker than larger destinations like New York and Las Vegas in the U.S., based on year-on-year demand for domestic accommodation searches.
Despite continuing consumer uncertainty, the desire to travel remains very strong
Nearly two-thirds (65%) of respondents are still thinking about where they want to travel next
"While there was positive progress over the course of the summer, the re-introduction of tighter restrictions on travel in many countries is clearly having an impact on demand in the short-term," said Steve Kaufer, chief executive officer, Tripadvisor, "The good news is that consumers' desire to travel remains incredibly resilient, and that pent-up demand bodes well for the travel industry in the long run, especially considering the advances announced last week in the development of a vaccine."
"The industry has shown incredible adaptability and resilience in what has been a long and difficult year for travel," said Charuta Fadnis, senior vice-president of research and product strategy, Phocuswright. "Our research consistently shows that travel remains a key part of consumers' lifestyles and travelers are keen to indulge their wanderlust again. Vaccines and therapeutics will boost the nascent recovery and the industry can look forward to brighter days ahead."
The joint report by Tripadvisor and Phocuswright provides an update to the findings published in a June research paper by Tripadvisor, entitled 'Beyond COVID-19: The Road to Recovery for the Travel Industry', www.tripadvisor.com/Covid19WhitepaperMay2020
which outlined five distinct stages of tourism impact and recovery resulting from the pandemic:
Decline - Travel declines sharply as widespread restrictions enforced
Plateau - Sharp decline in bookings levels out, but travelers start dreaming their next trip
Emerge - Easing of travel restrictions begins, early signs of recovery in dining sector
Domestic Travel - Travelers book their first trips away, but stay close to home
International Travel - Border restrictions ease, and international travel begins to rebound.
For additional information on the impact COVID-19 has had on the tourism industry, visit Phocuswright at https://www.phocuswright.com/ or visit Tripadvisor's webinar series found at:
The data cited in this release was gathered and analyzed from two key sources:
Predictions on recovery from a consultant who has an eye on it all
As the head of travel and tourism for Boston Consulting Group, Jason Guggenheim is used to troubleshooting on behalf of airlines and hotel companies when the road gets bumpy. Typically that means rethinking operations and carrying out restructuring efforts for sprawling resorts, cruise lines, online travel agencies, or big names in air travel. But even for someone whose job it is to fix the industry’s most complicated problems, there’s never been a year as turbulent as 2020.
Clearer skies may be ahead in 2021, but that’s relative. Boston Consulting Group predicts that travel won’t rebound to 2019 levels until 2023 or 2024. So Guggenheim is likely to be just as busy next year—and the following, and the following.
That’s because the tourism business is driven by the great intangible of consumer confidence. Regardless of therapeutics or vaccine availability, second or third waves, or the efficacy of safety protocols, the industry won’t fully recover until travelers and service providers do so psychologically. Even then, the industry varies greatly, ranging from the already booming roadside hotel sector to unable-to-operate cruise lines.
Here’s what to expect in the medium to long term, from an expert who has an eye on it all.
Staying Near vs. Going Far
The 2020 trend of vacationing within driving distance is here to stay—or at least some semblance of it. “Our research tells us that across demographics, wealthy or not, people still miss the unique experiences that travel provides,” Guggenheim says. But when it comes to the once-in-a-lifetime, long-haul trips that were gaining enormous popularity in the before days, “that sort of travel is going to take a longer time to come back.”
Instead, Guggenheim predicts that travelers will find the same unique experiences within a smaller radius of their home. In the U.S., he says, that will mean a continued reliance on domestic travel and short-haul destinations like Costa Rica that provide a large range of options for adventure and pampering.
“Being many time zones away from home and in remote locations in jungles or islands—people will worry, ‘If I get sick, I’m 14 hours from home in a country that may not speak my language or offer me medical treatment to the standards I get at home,’ ” Guggenheim explains. That line of logic only deepens for destinations that require multiple flights, including those on small or regional aircraft.
This inverts the formula of what was selling in pre-pandemic days. Safaris, Robinson Crusoe-style getaways to private islands, and cruises to arctic climes will carry newly significant risks, while trips that lacked exoticism or far-flung romance now feel safe and exciting in their own ways.
All this gets amplified by the trends of who books big-ticket trips. The 55-plus set, which has driven the high-spending multigenerational travel trend, has now become the most high-risk and safety-conscious.
“They will not travel [that way] for a number of years or maybe ever again,” Guggenheim says, making exceptions for very experienced travelers. That’s why he believes long-haul business travel will actually eclipse long-haul leisure in the short term. “Age is definitely an influencer of the return of long-haul leisure—and long-haul cruise, that market is going to be slow for a while.”
Trusty Hotels vs. Private Airbnbs
The definition of luxury has shifted to prioritize private space over personal service. Statistically, Guggenheim says, “only about 9% of people [we’ve surveyed] are worried about catching Covid-19 in their homes, whereas about 48% are worried about catching it from traveling.” Airbnb, which offers maximum control over environment and minimum contact with strangers, ranks lowest among those travel-related worries, while flying and cruising are much higher.
But that doesn’t mean Airbnb will reign supreme forever. “Airbnb gets a benefit of feeling more like home than a hotel,” he says. “But for the wealthy, there are a lot more options.”
Among them are exclusive house-swapping clubs like Third Home or membership-based models that offer time-shares, such as access to mansions in Los Cabos or Breckenridge. “These services were gaining in popularity pre-Covid, and I suspect we will see more of that—especially at the ultrahigh end.”
Where does that leave hotels? “Many are going well above and beyond to keep people safe, beyond what is purely regulated,” Guggenheim says. But there’s still fear, particularly around lobbies and elevators. With souped-up RVs encouraging traditionally upscale travelers to swap nationally renowned spas for nationally protected forests, a full recovery may be several years away.
Small Companies vs. Big Boxes
If the entire travel industry has become one big season of Survivor, the winners and losers of this narrative may be as unpredictable as those on TV.
“It’s true that large corporations have more financial flexibility and options at their disposal in terms of raising capital, while small, locally owned businesses are more at risk,” says Guggenheim. But it can be hard to tell what’s what.
Your favorite hotel may have a Marriott flag at its entry but be owned by a local family that’s struggling to pay the mortgage or staff salaries, he explains. (Like many global hotel companies, Marriott manages its properties while remaining asset-light.) This is especially true of five-star hotels under such brands as Marriott’s Luxury Collection or Hilton’s Autograph Collection; the benefit their individual owners receive from big-box affiliations tends to rest largely with marketing muscle and business-boosting loyalty programs.
Then there’s the question of location. Beyond hard-hit cities, businesses will generally struggle to keep the lights on in beach towns and tourist towns where the economy relies disproportionately on vacationers.
“If there’s nobody coming to the businesses around them, and their locations are being decimated, hotels [of all kinds] will feel the strain,” says Guggenheim. In those cases, survival might rely on access to public funding or debt and equity markets—tools more likely available to the big fish in the pond. (A large convention center hotel, perhaps.) But even the biggest fish in a deserted pond will be on shakier ground than small fish in a sought-after one.
Deal or No Deal
Desperate times call for desperate measures. But Guggenheim says that while hotels may goose demand with promotions in certain leisure markets, that won’t translate to bargain-basement pricing—especially not where airfare is concerned.
“People who are comfortable with traveling right now are probably less price-sensitive,” he says, “and those who are choosing not to fly will probably not be influenced just because there’s a good deal on a ticket.”
“The majority of travelers will tell you—the number is well into the 60% range—that a vaccine is really what’s necessary for them to truly travel again.” Hopefully that happens before next summer. That peak travel season, Guggenheim explains, could be a watershed moment in which travel companies may need to seek bankruptcy protection or find other ways to protect liquidity.
But it’s about more than just a financial impact. A down summer in 2021 “would have a damaging effect on the psyche of the workforce, who would have gone two summers without operating at their best,” he says. “It’s a financial make-or-break, yes, but also a psychological one.”
“Right now any signal of normality is desired and needed,” Guggenheim continues. “It’s hard to put wins on the board right now, so having any step change will feel psychologically very important for the industry as a whole.”
Skift - December 1 2020.
When tourism came to an abrupt halt in March, destination marketing organizations saw their primary revenue stream — a percentage of lodging taxes or “bed taxes” — tumble overnight.
Seven months since discussions began on how tourism would fund itself going forward after the damage from the pandemic, most organizations have seen their budgets shrink by as much as 60 percent while having to do more with less. And although some so-called DMOs have received emergency government assistance, the continued global health emergency’s strain on U.S. state budgets in particular, means that getting funding for tourism isn’t likely to take priority going into 2021.
That is forcing DMOs to do some hard thinking about changing up models from the past, according to interviews conducted by Skift over the past several weeks as new surges in coronavirus cases raise new uncertainties for travel.
Strategic marketing firm Miles Partnership, in collaboration with Civitas and Tourism Economics, earlier this year released a “Futures Funding” report laying out 10 recommended short- to medium-term priorities for DMOs until travel fully rebounds. They still are relevant now.
The priorities range from securing emergency funding to reviewing the DMOs’ structure, finding alternative revenue streams, taking on an advocacy role to push for change, and building up future reserves.
The report also shares data from a survey of 115 North American cities, all 50 U.S. states and 10 Canadian provinces, assessing their current state and recovery over the next five years. In November, Group Nao, a global innovation company, released a white paper — “Tourism Taxes by Design” — examining the use of tourism taxes in European cities as a funding mechanism, as well as data on the impact of Covid on European tourism marketing offices.
In addition to reviewing these studies, Skift spoke to a handful of DMOs to see how they’ve fared since April.
Our main takeaway: the DMO of yesterday is no longer, as destinations have been pushed into a whole new range of roles and responsibilities that go well beyond marketing in order to survive in a post-Covid world. These include advocating to lawmakers for their share of emergency funding through the CARES Act, forging political partnerships to establish new revenue mechanisms such as tourism improvement districts, demonstrating the value of tourism for economic development to their citizens, and reaching out to new corporate partners outside of the tourism sector.
“From marketing to destination management to economic development, and now it’s more a stewardship type of approach,” Milton Segarra, CEO of Coastal Mississippi and director-at-large on the US Travel Association Board of Directors, told Skift. “So in the last five years we have seen more changes in our business model than I think any other component of the tourism industry. And it’s a fast pace, extremely volatile, in terms of how you manage four basic components of this equation: a successful organization; the funding model; advocacy, dealing with elected officials; and how you’re going to deal with the communities. [I]n the middle is the visitor.”
FULL DMO FUNDING RECOVERY THREE TO FOUR YEARS AWAY
In the Futures Funding report, Tourism Economics reveals a 52 percent drop in 2020 hotel tax related revenue for North American DMOs, while full funding recovery is estimated to take three to four years from now. Ninety percent of U.S. DMOs and 85.7 percent of Canadian DMOs surveyed said their annual budget had decreased by 45 to 59 percent, respectively. In Europe, one in three DMOs has seen its 2020 budget plummet by 50 percent or more.
North American DMOs also shared that they expect their 2021 budgets to decline by 27-47 percent, while Canadian tourism offices estimated a 41 percent drop for 2021, although Canadian tourism offices benefit from a wider range of federal and provincial government support. What these survey numbers reveal is how urgent it remains for DMOs to seek emergency recovery funds in the short term, as well as stable future funding sources in order to survive on the other side of Covid.
“We’re funded by the hotel/motel tax like most DMOs are,” Kristen Jarnagin, CEO of Discover Long Island, told Skift. “On Long Island, it’s very low, it’s only three percent and of that three percent we get less than 20 percent, and the rest of it goes to the two counties and they use it for a variety of distributions.”
This means Discover Long Island receives just about $3 million out of Long Island’s $17 million in bed tax revenue. “But all the tourism revenues — if you look at restaurants, retail, transportation — that’s about $740 million annually in local and state tax revenues,” Jarnagin said. “So we’re kind of fighting over the scraps for the hotel/motel. Driving those visitors is what generates that [$740 million].”
Coastal Mississippi has lost nearly $1 million in hotel bed taxes since March, despite faring better in tourism numbers over the summer, thanks of its drive destination appeal. CEO Milton Segarra told Skift the lost revenue had a very significant impact for the size of the DMO.
“It was a 20 percent [loss] on tax revenues, when you compare fiscal year 2019 with fiscal year 2020, and the total number was like $900,000 less in room tax that we did not see happening,” Segarra said.
This amount was significant for a small to medium sized DMO in the $5-6 million range budget, forcing it to make up the loss through furloughs, salary cuts, canceled service contracts and driving visitors to the destination when it reopened.
With numerous U.S. DMOs in the same boat, the consensus is that the hotel bed tax can no longer be the sole source of funding for their activities. In the Funding Futures survey, 71 percent of U.S. DMOs and 64 percent of Canadian DMOs indicated they were actively seeking new funding options.
“I personally think the industry long-term needs to diversify beyond just hotels because of what we’re going through right now,” Jarnagin said, “and just like any other corporation would in America, you would look at any funding stream you had to be successful, and that’s exactly what we should do.”
DIVERSIFYING DMO REVENUE: PUBLIC-PRIVATE SOLUTIONS
In seeking alternative streams of revenue, more destination marketers have been thinking out of the box, including considering mechanisms such as the tourism improvement district, which the Funding Futures report recommends as a future stable revenue stream, particularly in light of the current tourism crisis.
Pre Covid, a handful of destinations, particularly on the West Coast, were already benefiting from increased budgets thanks to this privately managed hotel assessment. For instance, Visit Anaheim CEO Jay Burress, on a recent “Funding for Tomorrow” webinar, hosted by Miles Partnership and Civitas, shared that establishing this additional revenue mechanism in 2010 helped the DMO’s budget grow from $8 million to $20 million a year.
Amid Covid, tourism improvement districts have proven to be a DMO lifesaver, bringing in funds when the DMO otherwise might not have seen any incoming bed tax revenue. In July, for instance, San Diego Tourism Authority received $32.3 million in funding through the San Diego Tourism Marketing District (SDTMD) for its 2021 budget, approved by the City Council.
“Despite facing a significant hit to our assessment collections due to the coronavirus, our City continues to have a productive public-private partnership in SDTMD,” the district’s board Chair Richard Bartell said in a press release. “Without it there would be little to no funds for tourism marketing, which is what drives visitation that generates tax dollars to fund the city’s essential services, supports thousands of direct tourism jobs and attracts billions in visitor spending.” The San Diego City Council also extended San Diego’s Tourism Marketing District operating agreement for another 10 years.
When Los Cabos Tourism Board was forced to branch out solo after the Mexico Tourism Board disbanded a year ago, it established a second, private sector financed fund to supplement the hotel bed tax revenue — a move that came months before the global tourism halt.
“We started a second trust that is just through private contributions and it’s on a membership basis where hotels and destination management companies and activities contribute, that is being used as a complement to what the public [hotel taxes] trust is doing,” Rodrigo Esponda, managing director of Los Cabos Tourism Board, told Skift.
In 2019, that meant $12 million in Los Cabos Tourism Board’s public trust and $2 million in the private trust. While the public funds suffered a hit due to Covid and hotel bed tax declines, the private trust, which also helps to fund an office in Los Angeles, saw continued contributions from private business.
“Very interestingly throughout Covid 19, even though the hotels were closed and other businesses were not having any tours, they kept covering the cost of the membership in the private trust, which is a really good example of the relevance that they see to the activities that we do.” Esponda said. “So they understood that the only way that we could implement these [marketing] campaigns and these communication strategies was if they would keep the funding coming.”
The challenge for North American DMOs is that they’re not dealing with the same set of legal scenarios or funding options. Crisis has opened the door to innovation, but not all solutions will be one-size-fits-all. Coastal Mississippi, for instance, is putting aside the tourism improvement district solution for now, which it had begun working on last year.
“[W] e are making sure we know exactly what the organization will look like and see what other potential revenues are available before we go into that one,” Coastal Mississippi’s Segarra said. After successfully advocating for emergency recovery funding from the state, the DMO is now focused on going through every cent it receives from the hotel bed tax.
For Long Island, part of the challenge is that hotels paying into the bed tax automatically get to be members of Discover Long Island, per the current legislation. “So any hotel that pays into the bed tax gets all of our benefits for free,” Jarnagin said. “So you have to think about that, since 2013 we haven’t received any additional dollars but every single hotel that opened is a new member of ours.”
Other solutions discussed in the Futures Funding report are long-term, including building reserves and regenerative funding, as DMOs — 70 to 90 percent of North American tourism offices surveyed — look to play a more important role in the sustainability of their destinations as well as increase engagement with residents and local businesses. For now, however, the priority remains surviving the crisis by resorting to all possibilities of emergency funding from governments, while creating new mechanisms and finding new partnerships for corporate support.
LOOKING BEYOND TOURISM FOR PARTNERSHIPS
The Future Funding report reminds DMOs that all entities benefitting from the DMO’s work and its contribution to the destination should be fair game as potential future funding partners. Tourism marketing organizations should therefore begin reaching out to and consider to non-traditional tourism partners such as airports, universities, commercial property owners, and employers.
A handful of DMOs have taken that approach since Covid and begun thinking out of the box.
“We’re having a strategic session with our board next week, and one of the topics is how we’re going to from now on reach out to the local community,” Coastal Mississippi’s Segarra told Skift. “It doesn’t have to be a hotel or a transportation company, it could be a university or a bank, or construction companies — different partners that are really important and because we’re successful, they’re successful as well.”
Discover Long Island is eyeing the “city to suburb” exodus to market its services as a type of one-stop agency for attracting businesses to Long Island. “[W]e realized there’s no regional marketing entity for Long Island for economic development,” Jarnagin said. As a result, the DMO teamed up with the area’s eight Industry Development Associations to form the Long Island Development Collective, with the aim of promoting the region as a great place to “work, live, play” and attract business to the area.
The next phase would be building corporate sponsorship programs where corporations can start buying into Discover Long Island’s branding. “[W]e’ve been contacted by a lot of developers, corporations, real estate brokers, asking how can we get involved with what you’re doing,” Jarnagin said.
Los Cabos, where 80 percent of the economy relies on tourism and events contribute 6.8 percent to the gross domestic product, quickly pivoted in reaching out to new sources of private partnerships. “We are now expanding to the restaurant association of the destination, which is going to contribute to all our marketing strategies; it has the 85 biggest restaurants,” Esponda told Skift.
“We coordinated a digital concert when we reopened the destination and that concert was funded by American Express, which would not be a traditional partner in the tourism industry, but they funded all the cost. We have had interesting conversations with a couple of banks in the destination, and also we are looking to some real estate companies.”
BALANCING MARKETING AND ADVOCACY
Being deemed ineligible for the federal government’s CARES Act’s relief program for small businesses based on their classifications as 501(c)(6) non profits meant DMOs had to advocate for themselves and for tourism as major economic drivers that benefit the government and the community.
“What I don’t think we have done as destination organizations is express the importance of us,” Jay Burris, president and CEO of Visit Anaheim, said at the Funding for Tomorrow webinar. “They still think of us as a lobby group or a chamber, or a nice to have, not a need to have, not an ingrained part of a driver for the economy.” Burris suggested the creation of a future separate tax classification for tourism marketing organizations.
Coastal Mississippi also quickly embraced an advocacy role in April, alongside the state’s remaining tourism marketing offices, when it presented a case to the state as to why it must allocate a portion of the $1.25 billion CARES Act money to Mississippi’s tourism industry.
“We convinced the legislators about the need to make sure that the fourth largest industry in Mississippi, which is tourism, has a special input of dollars in this particular time,” Segarra said. “This was the first time ever in Mississippi to do something like this. It was very well received.”
By July, the state had allocated $13.5 million to Mississippi’s tourism boards, of which $3.4 million to Coastal Mississippi, which gave it funds for continued sales, marketing communications, technology, research and strategic partnerships.
With Covid county reports showing that tourism was the number one negatively impacted industry on Long Island, Discover Long Island saw it as an ideal time to introduce a new state bill for the approval of a tourism recovery investment district, whereby the additional hotel assessment funds being sought will also help with Covid recovery.
“So it’s a statewide initiative now; we spearheaded it, but it’s really a collective effort,” Jarnagin said. “It allows counties to opt in once it passes the state level.”
The legislature was adjourned before a vote on the bill could take place, but Discover Long Island hopes it will happen in January, when the same bill is reintroduced.
In a nutshell, this period of forced advocacy from DMOs has shows the need for increased community and government education on the important role of tourism marketing offices.
“You’ll be surprised how many highly successful entrepreneurs don’t know what we do or they don’t understand the business,” Segarra told Skift. “And then, the key is to educate the elected officials. The level of not knowing everything we do, it’s high and it’s our responsibility.”
BONDING WITH LOCALS THROUGH “COMMUNITY-SHARED VALUES”
What does a tourism marketing office do when its international and out-of-state tourists disappear? It starts talking to its residents. Just as DMOs were forced to make political partnerships, they had to communicate with locals more frequently. Residents became the DMO’s sole source of visitor revenue and a critical part of keeping the destination safe from Covid, and the DMO become the guiding light for locals in terms of safety protocols and advice on safe activities, sights, and places to stay as the economy reopened.
But there’s still a disconnect when it comes to residents valuing the impact of tourism on the places they live. From a recent Longwoods International study that Skift reported on recently, only about half of Americans think tourism is positive for the country, and we found that “citizen-level education is still needed on benefits of tourism to local and regional economies.”
Tourism marketing leaders agree this is an ongoing issue. The Futures Funding report calls this building on “community shared values” and recommends DMOs to “help [others] understand your activities, and how a great place to visit can also be a great place to study, start or grow a business or invest.”
“Right now people must understand — I’m talking about the locals — they need to know the impact we bring,” Segarra said. “Here in Mississippi, the taxes generated for the state represent $600 per household less than what [locals] have to pay but on the coast it’s $1,600 less that otherwise, if it weren’t for the taxes we generate, would have to be paid by locals.”
This “need to know” advocacy also applies to European tourism marketing offices and their residents. “We are totally underestimated,” Michael O’Tremba, managing director of the Hamburg Tourist Board, recently shared. “We should communicate stronger, make it more visible what we do [.] We care for the quality of life in the city. Would we have 4,000 restaurants in Hamburg if we wouldn’t have 100 million day guests — no of course not, we wouldn’t need it. The frequency of the public transport system wouldn’t be so high.”
Almost 70 percent of Hamburg’s accommodation tax also goes into festivals or sport events, O’Tremba added, including almost 60 percent invested in culture.
Discover Long Island’s concerted effort in communicating its role to residents has been ongoing for the last five years. “But the reality is, in my opinion, no matter how much we educate the locals and the elected officials, there’s always going to be that disconnect, because it’s hard to look at the long game[,]” Janargin told Skift.
THE FUTURE DMO: AN INDEPENDENT “BEACON OF INFORMATION”?
As the months evolve and DMOs continue to expand in their roles, new forms of collaboration and funding mechanisms are likely to continue emerging. Public-private partnerships and tourism recovery investment districts are expected to increase, but for some DMOs the sky’s the limit for innovating in the midst of crisis.
Discover Long Island believes that in a distant future, it could operate independently like an agency. “We hired a video producer, content creator in house to do our online YouTube Channel, we’re producing all of our podcasts in house, we do all of our graphic design — why shouldn’t we be a private agency that all these businesses buy into? Compared to three million dollars a year, they’ll pay a marketing agency $500,000 a month retainer.”
First securing a stable private funding stream would have to be the first step in reinventing the DMO’s model for the long-term.
What’s for sure, is that the ongoing crisis will continue to bring all parties to the table — governments, corporations, citizens and community players — to join the conversation on the critical, multifaceted role of tourism marketing organizations post Covid.
“This is what DMOs will have to understand from now on: there’s no longer the time to just promote, it’s over. The notion that you’re going to get the business because you’re able to engage with that particular individual only based on tourism attributes, it’s over. [W]hen you’re traveling right now you don’t only select a hotel or airline, you select a destination that you know — what about safety, what about crime, what about terrorism, quality of life? So the new spiral of attributes has expanded tremendously. [T]he destination has to become a beacon of information overall on what is about us.”
With the fourth major travel holiday of the pandemic passing amongst a litany of restrictions and warnings, the burning question is: did Americans take trips for Thanksgiving 2020? Nearly 14% said they did—a rate similar to Labor Day weekend. About half of these Thanksgiving travelers plan to quarantine for some period after their trip while the other half will resume their normal activities. As we look ahead to December, nearly one-in-five Americans say they plan to take a Christmas holiday trip.
In terms of how Americans are feeling about the virus, many emotions remain largely unchanged. Anxieties about personally or loved ones’ contracting the virus and the pandemic’s impact on personal and national economics are in an elevated but stable period that have not reached the peak levels seen during the two prior surges in March and July. Over 60% of Americans continue to believe the pandemic is going to get worse in the next month.
Such concerns are still impacting Americans’ current travel marketability. Americans’ openness to travel inspiration has been on a steady decline since October 18th, when it hit a pandemic peak, but is now at 4.9 on a 0-11 scale. This week, fully half of American travelers say they have lost their interest in traveling for the time being, and 62.0% say if they were to travel right now, they wouldn’t be able to fully enjoy it.
The focus of some recent news stories on pandemic behaviors in specific travel destinations is also acting as a sentiment depressant. In the past month, 35.8% of Americans report they have seen one or more COVID-19 related reports in the media about travel destinations where people were behaving in a manner that would make them feel uncomfortable visiting. Unsurprisingly, 79.8% of those who have seen reports of such behaviors say that this news makes them less interested in visiting these destinations.
The significant increase in cases has resulted in new or returning consumer restrictions around the United States. Over half of Americans reports that their local community has instituted more restrictive COVID-19 rules in the past month and over half feel more restrictions are coming. Just under one-third say new travel restrictions have been imposed where they reside, and just over one-third say they would be more comfortable traveling within their home states under such restrictions. And while a majority agree with new/reinstituted restrictions and agree it’s important people follow government restrictions and recommendations related to controlling COVID-19, these restrictions are achieving their intention to deter travel right now. 29.4% of those with trip plans cancelled or postponed by the pandemic say this was due to government travel restrictions and over 30% said new travel restrictions make them less likely to travel even within their own states in the next two months.
Still, the worst of this latest surge’s impact on travel behavior may be passing or at least be in a temporary reprieve. The percent of American travelers who report they have cancelled or postponed any upcoming leisure trips because of the recent increases in COVID-19 cases in the U.S. has dropped to 38.1% from 47.4% two weeks ago, and now 56.3% say recent increases in COVID-19 cases around the country have made them less likely to travel in the next three months–down from 62.8% in the same period. This week 55.5% have returned to a readiness (versus hesitation) state-of-mind about travel.
Reports of vaccine developments also continue to provide Americans hope about their travel future. A majority of Americans still feel the latest vaccine news makes them more optimistic they can travel safely in the next six months. Over 44.2% agree that their “first trip after a COVID-19 vaccine becomes available will be a vacation, likely to a place far from my home.”
This week 80% of American travelers have at least tentative trip plans for the future. In trying to understand what will motivate Americans to take trips, we requested those we surveyed to imagine that a friend or family member came to them with an idea to travel together in the next six months, and then asked what possible attributes of their friend’s travel idea would be most persuasive to get them to go. The pandemic clearly still weighs heavy, with confidence travel can be done safely, easy cancellation policies and relaxation the top motivational attributes. However, when asked where they most want to travel to in the next 12 months, the Hot List looks nearly identical to pre-pandemic, with Florida, New York, California, Hawaii and Las Vegas coming out on top.
COVID-19 testing will likely remain part of American travel behaviors for the near future. 28.7% of those who have traveled by air during the pandemic said they tested themselves after their most recent commercial airline trip. Nearly 40% of Americans say they plan on taking a COVID-19 test prior to taking their next trip.
If you need shareable graphics, content for presentations, video presentations and more, please visit our COVID-19 Insights Media page here.
Update on American Travel in the Period of Coronavirus—Week of November 30th·
Moving the Travel Industry Forward on “Destinations. Passport to Travel & Hospitality”
Update on American Travel in the Period of Coronavirus—Week of November 23rd
How US Border Destinations are Faring with COVID-19’s Impact
Update on American Travel in the Period of Coronavirus—Week of November 16th
The Present & Future of Live Events
The Rough Road for Millennials During the Coronavirus Pandemic
Update on American Travel in the Period of Coronavirus—Week of November 9th
Coping with Pandemic Stress & Anxiety
An Outlook on the 2020 Holiday Shopping Season and Beyond
Update on American Travel in the Period of Coronavirus—Week of November 2
Can More be Done to Get Americans Back to Traveling the Friendly Skies?
The 2020 Holiday Travel Season
Update on American Travel in the Period of Coronavirus—Week of October 26th
The Return to Convention Travel
The travel industry is moving ahead with plans to ensure a coronavirus vaccine means tourism and travel, both domestically and internationally, can quickly be revived.
Industry leaders are coordinating their efforts to create a digital passport that would say whether a passenger has been vaccinated for COVID-19.
The International Air Transport Association (IATA) announced this week it is in the final phase of development for what it hopes will be universally accepted documentation that in turn could boost confidence among wary travelers.
The digital health pass would include a passenger’s testing and vaccine information and would manage and verify information among governments, airlines, laboratories and travelers.
“Testing is the first key to enable international travel without quarantine measures. The second key is the global information infrastructure needed to securely manage, share and verify test data matched with traveler identities in compliance with border control requirements,” Alexandre de Juniac, IATA CEO, said in a statement on Monday.
The pass would enable travelers to find verified testing centers and labs at their point of departure that meet the standards and requirements of their destination to avoid quarantine rules and travel restrictions.
Drugmaker AstraZeneca announced Monday that its vaccine candidate, developed by Oxford University, is 70 percent effective on average but could be as high as 90 percent. Two other vaccines — one from Moderna and the other from Pfizer and BioNTech — both recently reported 95 percent efficacy rates.
When asked about how airlines are going to handle the rollout of vaccines, including how they would know if someone has been vaccinated, Airlines for America, which represents major commercial carriers, did not give a direct answer, saying only that U.S. airlines are “committed to restoring service in a manner that prioritizes the safety and wellbeing of our passengers and employees.”
Australian airline Qantas is reportedly making plans to require passengers get vaccinated before any international flights. CEO Alan Joyce said recently he thinks other carriers should follow suit.
U.S. airlines, which have lobbied for months for another COVID-19 relief package, say they can help the federal government with vaccine distribution.
“As the nation looks forward and takes on the logistical challenges of distributing a vaccine, it will be important to ensure there are sufficient certified employees and planes in service necessary for adequate capacity to complete the task,” several major airline CEOs wrote to congressional leaders this month.
With passenger volumes 65 percent below 2019 levels, any sort of relief — government assistance, testing protocols or a vaccine — would be most welcome by airlines.
The Thanksgiving holiday, which is typically a large revenue driver for the travel industry, became more challenging after the Centers for Disease Control and Prevention issued a warning against traveling as coronavirus cases surge in almost all parts of the country.
The busiest air travel day during the coronavirus pandemic was the Sunday before Thanksgiving, when nearly 1.05 million passengers were screened at U.S. airports.
But that was nowhere near the levels seen in previous years.
“We’re in this situation because of the lack of leadership from the United States government. Eight months into this and there’s no cohesive program,” said Peter Vlitas, senior vice president of airline relations at the Internova Travel Group.
The group argues that international travel would be able to resume if strict protocols were in place.
“We do not have a contact tracing national policy. If I fly to the U.K., I have to fill out a form. If I fly to Greece, I have to fill out a form. Many countries, you fill out a form. Besides the standard do you have a fever ... we don’t have the simplest of things,” Vlitas said.
Last month, travel industry groups called on the Trump administration to pursue an approach to COVID-19 testing that would remove the need for quarantines and travel bans.
The letter included the U.S. Travel Association, the American Hotel & Lodging Association and the U.S. Chamber of Commerce, who all said the patchwork approach is “confusing and discourages travel.”
The latest indicators on traveler sentiment show some good news for the industry. According to YouGov data from October and November, 51% of US respondents say they plan to travel for a vacation or business trip next year.
Travel aspirations are highest among younger Americans. Data from YouGov’s Global Travel Profiles reveals that 57% of 18-to-29-year-olds and 59% of 30-to-44-year-olds say they will either take a domestic/international vacation or domestic/international business trip within the next 12 months. And while a third of overall respondents say they do not plan to travel, each of these younger groups are significantly less likely to say so (24% and 27%, respectively).
Respondents aged 65 and over seem torn on whether they will travel over the coming year. Similar proportions say they will take some type of trip within the next 12 months (42%) as say they will not travel (43%).
Why younger generations may be traveling sooner and how to reach them
The high levels of travel intent among younger generations may be due to their perceptions of coronavirus. Since May, YouGov has been tracking how Americans feel about COVID-19 and how consumption patterns have changed amid the pandemic.
Nearly half of Americans (45%) say they are personally worried about getting COVID-19 with the highest levels of concern among Gen X (47%) and Boomers (48%). Younger Americans, however, seem less concerned. Both Gen Z adults (34%) and millennials (44%) are statistically less likely to say they are worried about personally contracting coronavirus. Given that younger generations appear to be less risk-averse when it comes to coronavirus related health-concerns, that could feed into their greater appetite for travel.
While the pandemic and related lockdowns have induced more time spent at home than abroad, the flip side is that there’s greater opportunity for advertisers and travel brands to engage with potential audiences. YouGov data shows that Americans are spending more time in front of screens with younger generations driving the increases in online media consumption.
An analysis of media consumption amid the pandemic shows that Gen Z adults and millennials have been engaging most with social media platforms, on-demand content (e.g., Netflix), and YouTube. Net usage among Gen Z is up across virtually every digital media channel but particularly for YouTube, on-demand content, Instagram, TikTok, and Twitter. Among millennials, net usage is highest among on-demand content, YouTube, TV, and Facebook.
Many in the travel industry, including advertisers and brands, have been active online throughout the pandemic - working to stay at the top of travelers’ minds with inspirational and experiential content. It’s also important, however, to consider which channels and platforms are the best to reach Gen Z and millennials, especially as this group seems the keenest to travel in the near future.
Methodology: The data from YouGov Global Travel Profiles is based on the interviews of 1,175 US adults aged 18 and over. Interviews were conducted online between October – November 2020 and results are unweighted.
The data on media consumption across generations is from YouGov Profiles and is based on the interviews of 14,848 US adults aged 18 and over. Interviews were conducted online between May – October 2020 and results have been weighted to be nationally representative.
Expert anticipates more unemployment and a substantial increase in cancelled reservations
Given the limitations placed on the tourism industry by the restrictions imposed by the new executive order to mitigate the coronavirus, the Puerto Rico Hotel and Tourism Association (PRHTA) foresees another dramatic drop in reservations and more job losses in the sector.
Last Friday, Gov. Wanda Vázquez banned once again recreational beach activities and limited casinos and swimming pools to 30 percent of their total occupation after the P.R. Department of Health reported a spike in COVID-19 cases. PRHTA President-elect Joaquín Bolívar III affirmed that these limitations are illogical and make it impossible for this economic sector to recover.
"We don't understand the reasoning behind the restrictions they place on us. In the hotels, there have been no outbreaks or sick employees. We have extreme health protocols. The limitations of the facilities prevent hotels from having a recovery," he stated.
Bolívar, who is also the president of the San Juan Water Beach Club, underscored that the drop in reservations that has been registered since the announcement of Executive Order 2020-080 last Friday has been in double digits and that the impact has been more noticeable in hotels and inns in the metropolitan area.
To date, the hotel industry is 80 percent below the business volume registered at the same time last year. However, with the previous economic reopening they had begun to register an advance in occupation, mainly during the weekends.
"Just when we were registering a slight improvement, they limit us again. It wasn't that we were doing well—because no hotel is making money—but there was some money flowing in on the weekends and we had started hiring employees again," Bolívar said.
Rise in Unemployment
Bolívar—who took the baton of the presidency of the PRHTA board of directors a week ago—pointed out that if the order limiting the offers had not been implemented, the trend reflected that they would register an approximate 10 percent increase in occupancy for January 2021. The high season for local tourism is usually during the months of November to March.
"There is no projection of high season this year. This will be a very sad period. We had started hiring again and they are people who, unfortunately, in the middle of Christmas, will be unemployed again. Even sadder is that the additional federal benefits for these people have already ended. It is a very sad scene," he stated.
It is estimated that tourism activity on the island represents more than 80,000 direct and indirect jobs, of which approximately 80 percent have been laid off or furloughed. The labor law establishes that after three months of temporary suspension, automatic dismissal proceeds, and after six months, employers are not obliged to rehire them.
"We are aware of the fiscal situation of the industry. Here we all have losses as a result of the pandemic. That is undeniable. This is worse than what the industry experienced after the 9/11 attacks. It is the worst situation we have faced in the last three decades," the PRHTA president-elect added.
Changes in the Tourist Profile
Bolívar understands that airlines play an important role in the island's recovery as a destination; nevertheless, he warned that because of price drops air tickets to Puerto Rico, there has been a change in the profile of the tourists who come to the island, who do not necessarily contribute to the industry's recovery.
"Very low rates are being seen to Puerto Rico. Roundtrip tickets from $34. That causes problems at the destination and does not contribute to economic recovery. These travelers do not necessarily stay in hotels and if they do, they do not consume anything inside the inn," he explained.
"These travelers come with a limited budget and do not seek to consume in the properties, nor in the restaurants that supply service to the hotels. It is not that cheap tickets make us the destination of the cheap, but you do not see the glamor that was seen before in the profile of the traveler who visited us. The impact of these visits is less," he added.
Call for More DMO Funding
Bolívar also opined that it is necessary for Puerto Rico to have the necessary resources to face the competition when tourist destinations return to operating normally. Thus, he called on the government to allocate more money to the Destination Marketing Organization (DMO), Discover Puerto Rico.
According to data from the Puerto Rico Tourism Co. (PRTC), the DMO currently has a budget of $25 million from room tax collections, of which the organization allocates an approximate 70 percent to marketing, promotion, and sales strategies; 22 percent for payroll expenses, and 8 percent for administrative expenses.
"The government has to allocate additional funds for the island's marketing. They have not been spending on public works, nor have they paid their debt in recent years. The funds are there and what needs to be done is request a special allocation from the Financial Oversight [and Management] Board. The DMO is key to our recovery. The return on what is invested in promotion is a lot," Bolívar said.
Lastly, Bolívar voiced his opposition to the PRTC becoming an office of the Department of Economic Development and Commerce (DDEC). “The key to our recovery is a DMO managing destination marketing and a PRTC managing tourism standards and development. This is the perfect formula ”, he specified.
Today (November 16 2020) , Expedia® released its 2021 Travel Trends Report, sharing predictions and hacks for travellers for the year ahead. By analyzing Expedia.ca data and insights from the Airlines Reporting Corporation (ARC), the report aims to arm travellers with the information and inspiration they need to make smart travel decisions coming out of an unprecedented year.
The report found that Canadians are booking their trips an average of 22 days before the vacation begins, compared to an average of 34 days in 2019.
Meanwhile, refundable trips were booked 10 per cent more frequently compared to 2020 and private vacations spots -- vacation homes, cottages and house boats -- were more popular than ever.
According to the report, Canadians are planning to embrace the winter like never before as four of the top 20 most searched destinations for 2021 are Canadian ski resort towns, while another three are more mild areas of British Columbia.
“As travellers within Canada, we will learn to travel differently, learn to experience winter at home,” Zajac said. “There are a lot of great things to experience across our country. Yes, it's cooler, but there are still a lot of things that we can do. Bundle up, get outside and see.”
That said, Canadians still have warmer climates on the brain, with 13 of the top 20 most popular destinations, including the top five, coming from warmer climates.
Zajac said this is a combination of Canadians’ optimism for how the next few months of the pandemic may go and a pent-up wanderlust from people longing for an international vacation.
“People are interested in -- when it is safe and when they're able to get away -- heading to a warm destination and particularly an island, whether it's somewhere in the Caribbean or whether it's even somewhere further like Bali,” Zajac said.
Priorities for Canadian Travellers in 2021
Flexibility isn't a "nice-to-have", it's required: In 2021, flexibility will continue to be top of mind for travellers, who booked refundable rates nearly 10 percent more often this year compared to last. Luckily, flexibility is more affordable than ever. Expedia.ca lodging data shows average daily rates for refundable bookings were nearly 15 percent cheaper in 2020 compared to 2019.
Health and safety advancements are essential: In 2021, concerns about staying safe while travelling will continue to impact every aspect of trip planning, from what type of accommodations to choose to where to go to who to travel with. Since May, nearly 300,000 properties have added health and cleanliness information on Expedia.ca, which includes enhanced cleaning measures, contactless check-in, social distancing and other guest safety considerations.
Shorter booking windows for travel plans: In 2019, the average Canadian traveler booked flights around 34 days in advance of their departure date, but during the onset of the pandemic, that window shortened to 22 days, where it remains. The new, shorter planning cycle illustrates how travellers have adapted to the rapidly changing environment and ongoing uncertainty. This is a trend we see with lodging as well. Last minute bookings during the summer were on the rise with around half of Canadian travellers booking trips 0-7 days out, an increase from previous years.3
Growth in alternative accommodation options: While the most popular lodging type in 2020 was hotels, this year certain alternative property types were more popular than in previous years. Specifically, this is the case for: private vacation homes, cottages, glamping experiences, treehouses and house boats. When looking to book a stay, the data shows that the lowest average daily rates are usually found on Mondays.
The Next Big Trip: Top-Searched Destinations for 2021 and Beyond
While nearby getaways and road trips are likely to remain popular as travellers navigate the ongoing realities of life amid a pandemic, search data5 proves that Canadian wanderlust remains strong. More specifically, it seems vacation-deprived Canadians dreaming of their next trip fall into one of two categories:
Sun and Beach Seekers. Looking at the top 20 most-searched destinations, over half are islands in the southern hemisphere or those offering a warm and sunny beach escape. After a year like 2020, it's not hard to imagine why so many travellers want to escape to an island the next chance they get. Typically, Canadians are used to trading in their winter coats for their summer clothes based on general seasonality, but of course this has been a year like no other, though this hasn't stopped travellers from staying inspired and dreaming of warmer weather.
Riviera Maya, Playa del Carmen and Tulum (#1)
Puerto Vallarta (#2)
Punta Cana (#8)
French Polynesia (#11)
Turks and Caicos (#16)
St. Lucia (#17)
Top searched destinations based on lodging interest on Expedia.ca between Jan 1, 2020 – Sept 12, 2020 for travel in 2021.
Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics.