Actions for Destination Marketers to Navigate in a COVID-19 World

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Actions for
Destination
Marketers to
Navigate in a
COVID-19 World
Actions for Destination
Marketers to Navigate
in a COVID-19 World

In partnership with

                          2
Authors
                                 BCG
                                  Christopher Bergman

                                  Principal

                                  Hans Clement

                                  Managing Director & Partner

                                  Pablo Martinez

                                  Managing Director & Senior Partner

                                 Google

                                  Abdullah Alassaf

                                   Industry Manager

                                  Songul Cengiz

                                  Principal Industry Analyst

                                  Cynthia Chami

                                  Analytical Consultant

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry   3
The COVID-19 pandemic has                 will they want to go? And how
                                         hugely impacted the global                can DMOs best prepare for the
                                         travel industry. Airline and hotel        eventual resumption of travel?
                                         bookings are down more than
                                         90% worldwide, and cruise ships           The key to answering these critical
                                         are under total no-sail orders. In        questions lies in capturing the
                                         April 2020, 91% of the world’s            data needed to properly prepare
                                         population lived in countries with        for the eventual increase in
                                         restrictions on travelers arriving        consumer demand for travel. This
                                         from other countries, and 39%             in turn will allow DMOs to plan
                                         lived in countries whose borders          accordingly, devising marketing
                                         were closed entirely. Little had          campaigns designed to lure
                                         changed by August to improve the          travelers to the most attractive
                                         situation.                                destinations, ensuring their safety,
                                                                                   and offering them experiences
                                         This has proven to be an extremely        that align closely with their desires
                                         challenging time for destination          and interests. In what follows, we
                                         marketing organizations (DMOs)            have synthesized data from BCG
                                         – which collectively includes             and Google consumer sentiment
                                         national tourism organizations            surveys and analysis conducted
                                         (NTOs), whose mission is to               over the past several months,
                                         generate demand for tourism               and from Google search data,
                                         from international markets by             to provide an in-depth view of
                                         building their destinations’ brands       the current state of the travel
                                         and raising traveler awareness            industry, how the pandemic has
                                         about their respective destination        affected consumer attitudes
                                         offerings. In ordinary times, DMOs        toward travel and tourism, as
                                         operate with a relatively high            well as recommendations on the
                                         degree of certainty; planning is an       way forward for the industry to
                                         annual process, setting budgets           recover.
                                         is a formality, traveler behavior is
                                         understood, and marketing plans           As the effects of the pandemic
                                         are clear and in place.                   decline and borders progressively
                                                                                   reopen, prospective travelers will
                                         That’s all changed. Now, DMOs             be eager to be on the move again,
                                         must apply their resources                and DMOs must be ready. This will
                                         to understanding COVID-19’s               require a level of speed and agility
                                         impact on travel, now and in the          that will likely be new to many
                                         future. How have consumers’               DMOs, long accustomed to the
                                         attitudes toward travel changed           slower pace of more predictable
                                         in response to the pandemic?              times. But it is essential if they are
                                         When will they begin to seek out          to recapture their pre-pandemic
                                         travel opportunities again? Where         visitor numbers.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                        4
The Rise of
                    COVID-19
                                         Over the past 20 years, the global        in mid-March 2020, the World
                                         travel and tourism business has           Health Organization officially
                                         grown at an impressive 5% annual          declared COVID-19 a pandemic,
                                         pace; in 2019 it totaled $4.7 trillion.   and countries around the world
                                         DMOs have been at the heart of            initiated domestic lock-downs
                                         this growth. Their roles vary: while      and began closing their borders to
                                         some focus primarily on promoting         travelers.
                                         their country’s attractions to
                                         tourists, others are charged with         The impact on the travel industry
                                         helping support the local economy,        was immediate. According to OAG
                                         attracting outside investment             flight data, more than 133 million
                                         in cultural and sporting events.          international trips were taken
                                         Some oversee implementation of            in March, helping to spread the
                                         the local tourism sector strategy,        coronavirus; by April, however,
                                         even regulating such matters as           that number had declined rapidly,
                                         licensing and quality standards.          to just under 16 million. As of June,
                                         Some are supported entirely               that number had only increased
                                         by their local governments;               marginally to 19 million.
                                         others collect fees from the
                                         local hospitality, cultural, and          While domestic airline travel has
                                         entertainment industries.                 remained somewhat healthier; still,
                                                                                   the total number of commercial
                                         In short, DMOs are central to the         passenger aircraft being stored
                                         economic well-being of localities         reached an unprecedented 55%
                                         everywhere, and especially                in April, up from just 10% at the
                                         to markets that are heavily               start of 2020, and far higher than
                                         dependent on tourism. By the              the number in storage following
                                         beginning of 2020, their marketing        the Sept. 11, 2001, terrorist attacks
                                         plans and schedule of events              (see Exhibit 1). Google searches
                                         would have been set for the               related to air travel declined
                                         coming 12 months.                         62% from their January levels, as
                                                                                   major international expositions,
                                         Then came COVID-19.                       conferences and sporting events
                                                                                   across the globe were cancelled or
                                         First detected in December 2019,          postponed, including Dubai’s Expo
                                         a few first-mover countries shut          2020, the Tokyo Olympics and the
                                         their borders in January. Then,           Beijing Motor Show.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                       5
Exhibit 1 | The percentage of commercial aircraft being stored reached an
                      all-time high in April, though it has declined somewhat since then

                                                                                                                                                                55%
        60%                 Global stored commercial aircraft by month, January 2000 to August 2020 (% of total fleet)
                                                                                                                                                                in April

        40%

        20%

         0%
           2000    2001   2002   2003    2004    2005   2006    2007    2008   2009    2010   2011 2012     2013   2014    2015   2016   2017    2018   2019    2020

          Note: To qualify for in-storage status an airliner must be observed as having had no fight activity for at least three consecutive days, regardless of any
          statements of intent by its operator. Cirium may retroactively update depending on acrrier data submissions.
          Source: Cirium Fleets Analyzer

                                                        As a result, despite massive                                  There is no telling for sure when
                                                        stimulus packages aiming at                                   the industry will recover. The
                                                        softening the pandemic’s impact,                              COVID-19 situation remains
                                                        more than 120 million jobs may                                volatile, with many countries
                                                        be lost in the travel and tourism                             experiencing waves of infection
                                                        industry, and that could rise to 190                          amid inconsistent government
                                                        million jobs, depending on how                                responses. We are currently
                                                        long travel restrictions remain                               tracking five potential scenarios
                                                        in place, according to the World                              for recovery, with the prolonged
                                                        Travel and Tourism Council. That’s a                          U-shape or L-shape being the
                                                        staggering 36% - 58% decline from                             most likely for travel to return
                                                        the 330 million jobs in the industry                          to pre-pandemic levels in our
                                                        in 2019. The industry’s contribution                          view (see Exhibit 2). By that time,
                                                        to global GDP could decline by $3.4                           however, any number of airlines
                                                        trillion (38%), it estimates, and by                          could go bankrupt and hotels,
                                                        up to $5.5 trillion (62%) under the                           resorts and restaurants will close
                                                        worst-case scenario.                                          forever.

                          Exhibit 2 | Estimates of when the travel industry will recover range
                                             from 12 to 18 months or longer

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                                           6
Safety first
                                                        The impact of COVID-19 on                                  finances due to the outbreak are
                                                        consumer sentiment around                                  more than twice as likely to want
                                                        travel has been severe. Reviving                           to reduce leisure travel as their
                                                        the travel industry will depend                            less-concerned peers.
                                                        largely on sensitivity to travelers’                       Financial constraints are not,
                                                        concerns. Around 80% of                                    of course, the only concern. All
                                                        consumers in the U.S. and France,                          consumers fear catching the
                                                        for example, believe that the                              virus; indeed, they are as much
                                                        virus will lead to a recession, and                        as three times more likely to fear
                                                        more than 45% are concerned                                getting sick while traveling than
                                                        about their personal finances.                             when shopping in local stores,
                                                        As a result, consumers are                                 and international travel is seen as
                                                        notably unwilling to spend on                              more dangerous than domestic.
                                                        luxury spend categories such as                            In the U.S., for example, 50% of
                                                        travel. Indeed, consumers who                              consumers fear catching the virus
                                                        are worried about their personal                           from traveling (see Exhibit 3).

                        Exhibit 3 | US consumers are far more concerned about traveling
                     internationally than they are about shopping locally or visiting friends

                         Respondents who are worried about catching the coronavirus from the following activities (%)

        Activity categories over time                                      Individual activities , August 2020
        60
                                  Travel & tourism

        50                                                                   43            45            54            55           57         61

                                                                           Airbnb        Hotel        Casino         Domestic International   Cruise
        40                                                                                                             flight     travel

        30                        Local activities

                                                                                                         44            54
        20                                                                                 35
                                                                             17
                                At-home activities                       Local store      Uber       Restaurant Bus, subway,
        10                                                                                                        or train

                                                                                           10             19
                                                                            3
         0
             March      April        May         June    July   August   Shopping      Ordering      Cooking at
                                                                          online       food for       a friend’s
                                                                                       delivery         house

        Note: Data as of August 15, 2020. US respondents only
        Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                       7
Age is a major factor in willingness                                          for example, are considerably
                                                             to travel—understandably, given                                               more reluctant to participate in
                                                             the greater vulnerability of older                                            any form of travel than those
                                                             people. As of August 2020,                                                    between 18 and 40 years old (see
                                                             U.S. consumers 56 and older,                                                  Exhibit 4).

                           Exhibit 4 | Consumers 56 and over are most likely to have health
                                        concerns regarding all travel offerings.

                            Consumers concerned about catching a virus with each activity (%)                                                              Consumers who resumed
                                                                                                                                                           travel in July or August (%)
                          International travel           Domestic flights           Goingon a cruise                Staying in a hotel

         100                                                                                                                                                   18-40                 16
                                                                                                 69
                                       64
                                                                   61                  62
                             56
                                                          53
                                                 46                                                                                    49
                  46
                                                                             44                                            43
                                                                                                           39                                                                        16
                                                                                                                                                               41-55

           0                                                                                                                                                    56+                  4
         Age    18-40      41-55       56+       18-40    41-55    56+      18-40     41-55     56+      18-40            41-55        56+

         Note: Data as of August 15, 2020. US respondents only
         Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

                                                             More than 70% of consumers                                                    normal. The definition of “normal,”
                                                             believe it is irresponsible to travel                                         however, varies considerably, and
                                                             until the virus is under control, and                                         that in turn affects the kinds of
                                                             more than 65% believe it is not                                               vacations travelers are willing to
                                                             worth the risk of taking a vacation                                           take. (See Exhibit 5.)
                                                             until things mostly return to

                         Exhibit 5 | Consumer sentiment varies widely regarding when the
                                          travel’s “new normal” will begin

                                                               When will you begin...? (%)
                                                            Staying     Flying on Visiting     Going on
          Only when...                                     at hotels    airplanes casinos       cruises        When do you think that will be? (%)

          ... Number of new cases slows in my country                                                              12                          58                          21              10
          ...Government says it’s ok to resume
          daily activities                                                                                     5                          55                         22               18

          .... Testing is widely available                                                                     7                     42                        29                    23

          .... No new cases our in my country                                                                  4                35                       29                     31

          .... Approved medications to treat the                                                               3          24                    32                        41
          virus are available
          .... A vacine is available                                                                           2 13               24                            62

                                                                                              Within 1 month            Within 2-6 months           Within 7-12 months         A year or more
               = 10%

         Note: Data as of May 11, 2020. Because of rounding, some bar charts totals do not equal 100%
         Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                                                                8
All things considered, the near-        have no plans to travel for the
                                                  term prospects for restarting           “foreseeable future”, although
                                                  the travel industry are unclear.        that varies depending on where
                                                  As many as 60% of consumers             they’re from. (See Exhibit 6.)

                       Exhibit 6 | When and how consumers expect to be able to travel
                                     again varies from country to country

                          Respondents who “strongly agree” or “somewhat agree” with the following statements (%)

                    I definitely will not
                    be traveling for the
                    foreseeable future

                    I have already started
                    traveling again/I never
                    stopped traveling

                    It is irresponsible to
                    travel until the
                    virus is under control

                    In the future, I will be
                    taking different types
                    of vacations than I
                    used to

                    I will only take a
                    vacation after the
                    economy recovers

          Note: Data as of May 11, 2020
          Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                            9
Early Actions
                                         Like organizations in every industry,     It soon became clear that
                                         DMOs were entirely unprepared for         protecting their own tourism
                                         the advent of COVID-19. In many           brands would be critical if they
                                         cases, their responses were swift.        were to quickly revive tourism in
                                         Some established emergency task           their home markets. To that end,
                                         forces to address issues such as          many have already developed
                                         the extent of the damage to their         innovative campaigns—
                                         travel sectors and the availability       including videos and social
                                         of travel opportunities remaining in      media programs—designed to
                                         their markets. Could they refocus         stay engaged with prospective
                                         their scope and efforts away              travelers and keep them dreaming
                                         from international tourism and            of travel during the pandemic,
                                         toward domestic travelers—not             while reassuring them on safety
                                         traditionally their target markets?       precautions needed during travel.
                                                                                   Portugal’s tourism board, for
                                         DMOs in countries where tourism           example, has focused its new
                                         is vital to the economy were              campaign on the message that
                                         under the most pressure to revive         you “can’t skip hope,” encouraging
                                         tourism, requiring many to take           prospective travelers to reflect
                                         several unfamiliar actions. Many          on the future of travel. Both the
                                         participated in meetings at the           Maldives and the Seychelles have
                                         highest level of government, a rare       released campaigns suggesting
                                         occurrence. They found themselves         that travelers keep dreaming
                                         collaborating with a wide variety of      about their next beach vacation.
                                         sometimes unfamiliar government           Sensitivity to the concerns of
                                         stakeholders, to advocate for key         travelers regarding health and
                                         measures needed to keep them              safety was key to setting the
                                         operating.                                right tone.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                   10
Getting
                    to Normal
                                         The travel and tourism industry           assuming consumers’ concerns
                                         has proven markedly resilient             about health and safety can be
                                         in the face of past disruptions.          alleviated. Fully 40% of those who
                                         Within a year after both the              say they won’t resume travel until a
                                         Sept. 11 terrorist attacks and            vaccine is available still expect that
                                         the 2008 financial crisis, it had         they will be able to travel within
                                         returned to its average upward            the next 12 months.
                                         growth trend. The COVID-19
                                         pandemic is different, however,           And they are looking for
                                         in part because it is the first truly     opportunities. In April 2020, air
                                         global crisis to take place in the        travel-related queries carried
                                         age of a fully connected planet.          out on Google were down 62%
                                         In addition to the health risks           year-over-year, but by August
                                         imposed by the virus, its recovery        , they were down just 42%
                                         will largely depend on how deep           compared with August 2019. The
                                         the crisis-induced recession lasts        top three questions users asked
                                         and the degree of its impact on           Google globally related to travel
                                         consumers’ ability to spend.              conducted in June comprised
                                                                                   “When can we travel again,” “when
                                         Certainly, the desire to return to        will international travel resume,”
                                         normal is strong. Consumers rate          and “when will it be safe to travel
                                         leisure travel as the top activity        again.” while top questions in
                                         they miss the most, and 31% want          August were related to where and
                                         to increase their leisure travel once     when we can travel “right now”. In
                                         the crisis subsides.                      fact, 45% of the top 100 questions
                                                                                   related to travel focused on the
                                         Signs of revival can already              impact of COVID-19, the need
                                         be found in the data on online            to travel as soon as possible and
                                         searches related to travel,               travel safety.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                       11
Google flight search data, too,                                  than three quarters of consumers
                                                         indicates increasing interest on                                 are searching for trips less than
                                                         the part of consumers in traveling                               three months out.
                                                         sooner rather than later; the “look-
                                                         ahead” window—the number                                         And while safety remains top of
                                                         of days between search and                                       mind, with 44% of consumers
                                                         departure dates—for domestic                                     hoping to travel soon citing
                                                         airline travel decreased from 48                                 “worry” as their No. 1 concern,
                                                         days at the end of April to just                                 most travelers would be willing
                                                         over 30 days at the end of June                                  to fly again as early as next
                                                         and to 28 days in August. Interest                               month if certain health and
                                                         in international travel is growing                               safety measures were in place
                                                         as well, with the look-ahead                                     (see Exhibit 7). Indeed, 60% of
                                                         window on international flights                                  consumers ranked virus safety
                                                         narrowing from 77 days at the end                                measures among their top three
                                                         of April to less than 45 days by                                 considerations when choosing a
                                                         the end of August. Overall, more                                 brand to travel with.

                         Exhibit 7 | The willingness to fly in the short-term depends largely
                             on the extent of the health and safety measures in place

    % of consumers needing additional sanitary                            Sanitary measures needed by consumers who answered
    measures before flying again in next month                            “some measures would convince me” from May 22-25

              5%           5%          7%           6%
                                                                                                                                                            Proof of   Medical
                                                                                                                                                             health      staff
                                                                                                                                                                       onboard

         April 10-13   April 24-27 May 8-11     May 22-25                Social      Hand        Regular     Protective      Air     Temp.    COVID-19
                                                                       distancing   sanitizer   anti-viral      gear       filters   checks      tests
                                                                       enforced                 cleaning                                      Pre-airport
                                                                                                                                                 entry
         I will fly regardless of measures next month

         Nothing would convince me to fly next month

         Some measures would convince me to fly next month

     Note: Data as of May 25, 2020
     Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                                                 12
Travel Dreams
                                                        In short, consumers are already                           take different types of vacations
                                                        showing signs of re-entering                              than they are typically used
                                                        the initial “discovery” phase                             to. For their first trip after the
                                                        of the typical consumer travel                            outbreak, most prospective
                                                        experience. Where do they dream                           travelers are looking to get away
                                                        of going, and why?                                        from it all on relaxing trips or
                                                                                                                  visits to family and friends. And
                                                        Overall, more than 35% of                                 they expect to take shorter trips,
                                                        consumers in the US expect to                             preferably by car (see Exhibit 8).

                        Exhibit 8 | Consumers are looking forward to relaxing getaways or
                                  visits to loved ones, and prefer to travel by car

    Respondents who have traveled since the                                          Respondents’ reasons for traveling since the virus
    coronavirus outbreak? (%)                                                        outbreak and preferred modes of transportation(%)

     1. Category includes the responses “Attend a special event” and “Other”. The “Other” group included some necessary trips, such as family/medical
     emergencies or moving
     2. Category includes the responses “Visit family/relatives” and “Visit friends”
     3. According to Phocuswright 2019 consumer travel survey, more people now choose to drive, compared to 33% car, 61% plane, and 6% other in 2018
     Note: Data as of August 16, 2020
     Source: BCG COVID-19 Consumer Sentiment Survey; BCG analysis

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                        13
Heading to the beach and visiting                               20% of consumers there plan to
                                                       rural areas or small towns is the                               take a trip in an RV in the next 12
                                                       highest priority among would-                                   months—half of whom attribute
                                                       be travelers, particularly for the                              their interest in RV camping
                                                       Italians and French (see Exhibit                                to current health concerns—
                                                       9). This may explain why sales                                  and 11% plan to purchase one,
                                                       of recreational vehicles (RVs)                                  according to the RV Industry
                                                       in the U.S. are strong. Almost                                  Association.

                        Exhibit 9 | Consumers are looking forward primarily to vacations
                                         at the beach or in rural location

        France

     Germany

           Italy

  Netherlands

             UK

       Canada

                      A beach destination          A small town              Other

                      A rural location             A major city              I would not travel in the next 3 months

     Note 1: Data as of August 14, 2020
     Note 2: May 1st 2020 Canada and May 22nd Netherlands changed methodology to collect answers from android users. All other results were collected from
     publisher network
     Source: Google surveys

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                             14
As noted, interest in domestic                            months has fluctuated. In June,
                                                       travel remains relatively healthy—                        more than half of respondents in
                                                       no surprise, given safety                                 Italy, for example, confirmed that
                                                       concerns and the many ongoing                             they would travel anywhere within
                                                       restrictions on international travel.                     their home country; since then,
                                                       Still, the percentage of survey                           however, that number has tapered
                                                       respondents who say they are                              off amid concerns about renewed
                                                       planning to travel domestically                           coronavirus outbreaks. (See
                                                       for a holiday within the next six                         Exhibit 10.)

                           Exhibit 10 | Domestic travel remains reasonably healthy despite
                                      fluctuations in response to the coronavirus

    60
                                                                                   54

                                                     44
                      38                                                                                                                         39
    40

    20

    0
                  Apr 10, 2020                May 8, 2020                     June 12, 2020                 July 10, 2020             August 14, 2020

                                                UK                 Italy         USA             Portugal            Canada

                                                Germany            Spain         France          Netherlands

     Note 1: Data as of August 14, 2020
     Note 2: May 1st 2020 Canada and May 22nd Netherlands changed methodology to collect answers from android users. All other results were collected from
     publisher network
     Source: Google surveys

                                                       That’s why domestic operations                            Several fast-moving DMOs have
                                                       continue to be the key focus for                          already started capitalizing on
                                                       most of the world’s airlines. As                          travelers’ focus on domestic
                                                       of June, they represented an                              travel, putting together dedicated
                                                       average 84% of their activities,                          campaigns and incentives to
                                                       up from 60% in January. In                                further promote interest in local
                                                       April, Google search queries for                          destinations. Japan, for example,
                                                       domestic flights globally were                            recently launched a $12.5 billion
                                                       down about 45% compared with                              “Go to Travel” campaign to help
                                                       last year, but they have grown                            pay for domestic vacations,
                                                       36% every month since then. The                           providing a subsidy of 8up to
                                                       strongest growth has been in                              $185 per traveler. And Vietnam is
                                                       North Africa and Eastern Europe,                          luring domestic travelers with a
                                                       while South Asia, North and                               public-private campaign offering
                                                       Central America have lagged.                              discounts of up to 50% on airlines,
                                                                                                                 travel agencies, and resorts.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                                                             15
Moving Fast
                                         The COVID-19 pandemic has                 and safety of their travel offerings
                                         radically transformed consumer            will be essential.
                                         behavior with respect to their            In contrast to the pre-pandemic
                                         travel and tourism desires and            travel environment, when travelers’
                                         expectations, and it will likely          wishes and expectations were
                                         continue to do so, even as                far more stable and predictable,
                                         conditions return to normal. In           the demand for travel is shifting
                                         response, DMOs must develop               unpredictably across categories,
                                         new ways to assess consumers’             channels, and geographies. Supply
                                         attitudes toward travel accurately        will shift unpredictably, too, as
                                         and quickly, and to adjust their          markets open to travel at different
                                         marketing campaigns accordingly.          speeds, depending on the pace of
                                         In this effort, building trust among      new confirmed cases and the rise
                                         prospective travelers in the health       and fall of travel restrictions.

                                         Competition to capture the pent-up demand for travel will be fierce,
                                         as DMOs rush to attract visitors and capture market share. So DMOs
                                         must act swiftly and with agility to avoid the significant downside
                                         risk, as the potential for losing market share quickly is high. The key,
                                         we believe, is to follow a Five-R approach:

                                           Reassess their offerings and value proposition in light of evolving
                                           traveler preferences, needs, and concerns.
                                           Reassure travelers on the safety of travel to your destination to
                                           address consumers’ health concerns.
                                           Raise awareness to pique the interest of consumers and inspire
                                           them to travel.
                                           Remove barriers in converting consumers to travelers by making
                                           the case for traveling now.
                                           Revive spending in the local economy by maximizing travel’s
                                           economic spillover effects.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                     16
Only by gathering and carefully            sources data from target market
                                         analyzing near-real-time data and          updates and indicators, consumer
                                         business intelligence will DMOs            sentiment and spending activity,
                                         gain the insights they need in             in-country supply readiness,
                                         our current highly volatile travel         and more. Analyzing the data
                                         environment. Traditional data and          could then provide insights into
                                         analytics that rely on historical          such matters as the readiness
                                         data and travel patterns will not          of consumers in target markets
                                         be adequate for predicting the             to travel, which could then be
                                         shape of the coming recovery, or           matched with availability of
                                         to respond effectively. The typical        specific travel options. Such a
                                         “upper funnel” of demand—                  solution would enable DMOs to
                                         the stage where prospective                support dynamic decision-making
                                         travelers dreamed of their next            and the development of strategies
                                         travel destination—has now been            to prepare to respond as source
                                         reduced substantially, and limited         markets and travel segments
                                         by factors such as the progression         recover from the pandemic at
                                         of COVID-19, government                    differing rates.
                                         travel sanctions, reduced flight
                                         availability, and the like.                Real-time analysis will require
                                                                                    most DMOs to overhaul their data
                                         To gain a better understanding             collection practices, however,
                                         of the current state of consumer           since current agreements with
                                         demand for travel, market                  data providers are typically set
                                         availability (including flights, hotels,   up to enable historical analysis,
                                         resorts and other aspects of               not the day-to-day changes in
                                         supply), and the state of the sector       consumer sentiment and industry
                                         generally, DMOs must capture and           availability that characterizes
                                         analyze data from a wide variety of        today’s travel and tourism sector.
                                         sources.                                   That’s why DMOs should explore
                                                                                    all the potential data sources that
                                         One solution would be to develop           provide the most useful up-to-
                                         an analytics “lighthouse” that             date information possible.

                                         With the best available data and insights in hand, DMOs can then
                                         begin to coordinate their efforts across three key activities:

                                           Product and service development. Guide deployment of new
                                           products and services in light of concerns about COVID-19 and
                                           the post-pandemic recovery. Strict health and safety standards,
                                           measures and regulations will be essential in luring travelers. At the
                                           same time, DMOs must work with both public and private partners
                                           to ensure an adequate range of safe, attractive options once they
                                           arrive, including new “wellness” travel products. Getting this right
                                           will require careful analysis across the entire travel experience, from
                                           dreaming, planning and arrival through to departure.
                                           Stakeholder engagement. Inform stakeholders, including
                                           governments and healthcare officials and travel industry suppliers,
                                           of unified communication messages and collaborate with them
                                           on setting travel and health standards. Encourage stakeholders to
                                           help communicate marketing messages to expand communication
                                           channels, and lobby government decision-makers to reduce
                                           barriers to travel.
                                           Marketing. Reallocate marketing spend by channel, and guide
                                           campaign messaging and timing.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                      17
The Right Products
                    and Services at
                    the Right Time
                                         As the world recovers from the            establishing itself as a credible
                                         COVID-19 pandemic, demand                 participant in the effort to ensure
                                         for travel will be largely shaped         that the destination’s healthcare
                                         by perceptions of a destination’s         system is adequately prepared
                                         health conditions and standards           to receive travelers in case they
                                         of medical care. Therefore,               get sick, and communicating the
                                         DMOs must take on the                     destination’s safety through its
                                         unfamiliar task of protecting the         marketing messages.
                                         health and safety of travelers by

                                         To that end, DMOs should promote the full range of health and safety
                                         measures across the entire travel journey. Countries and companies
                                         around the globe are already implementing advanced travel safety
                                         measures to reassure visitors, to prepare them for traveling, and
                                         protect them once they arrive. These include:

                                           Holistic health and safety protocols. Greece’s Minister of Tourism,
                                           for example, has outlined nine health and safety protocols (“The nine
                                           rules for tourists, flights, and hotels in Greece”) in response to COVID-19.
                                           Rapid COVID-19 tests, medical checkpoints, and sterilization
                                           robots at airports. For example, Emirates Airline, in partnership with
                                           Dubai Health Authority, tests passengers before boarding and makes
                                           test results available within 10 minutes, allowing the airline to clear
                                           each and every passenger. And Hong Kong Airports has deployed
                                           autonomous robots equipped with both a UV light sterilizer and an
                                           air sterilizer that kill up to 99.99% of bacteria and viruses in the air
                                           and on object surfaces in just 10 minutes.
                                            “Clean certification” for hotels. Tourism authorities in both
                                           Singapore and Portugal have partnered with local health authorities
                                           to issue “clean and safe” certificates for hotels. Others have
                                           turned to international organizations such as the UN’s World Trade
                                           Organization and the WTTC to validate the measures they’ve taken
                                           to ensure traveler safety. Such efforts help promote strong standards
                                           of hygiene and enable visitors to differentiate between certified
                                           venues and others.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                          18
Special travel insurance. Cyprus provides travel insurance to
                                           ease tourist’s infection anxieties by promising to cover trip costs
                                           if a traveler contracts COVID-19 while visiting the country. The
                                           coverage includes lodging, food, drink, and medicine for patients
                                           and their families.
                                           Contactless technology. A variety of high-tech solutions have been
                                           implemented as well. Some are as simple as no-touch payment and
                                           e-wallet technology and virtual or self-guided audio tours. Others
                                           are more avant-garde measures. Some airports are using facial and
                                           iris scanning for self-service bag drops, queue access, boarding
                                           gates, and retail and duty-free outlets. Hotels have tried dynamically
                                           generated room service menus on mobile app. Hilton Hotels has
                                           developed a mobile app for opening hotel room doors, controlling
                                           room temperature and lighting, and operating TVs.

                                         Meanwhile, clusters of countries          measures in light of changing
                                         are banding together to create            circumstances and as global
                                         multilateral “travel bubble”              health and safety standards
                                         agreements in hopes of unlocking          evolve. Travelers from different
                                         international tourism by devising         source markets will likely have
                                         coordinated health protocols,             different perceptions and
                                         mutually lowering travel barriers         expectations of what is considered
                                         and reducing other travel friction        safe and what measures they
                                         points for consumers. The Baltic          expect to find when they travel.
                                         nations—Lithuania, Latvia, and            So DMOs must gather the data
                                         Estonia—launched Europe’s first           needed to sense which health and
                                         travel bubble by opening the              safety measures matter most to
                                         borders between them, given their         prospective travelers, depending
                                         similar epidemiologic situation           on their primary source markets.
                                         and economic interdependence.
                                         A similar agreement between               DMOs must take great care in
                                         Australia and New Zealand                 communicating their destination’s
                                         is expected to be in place by             health and safety measures.
                                         September. China is working               The focus should be on health
                                         to create a travel bubble with            and safety, while promoting the
                                         Hong Kong, Macau, Taiwan, and             friction-free nature of travel to and
                                         South Korea, and Singapore is             within a particular destination. In
                                         in talks across Asia to establish         order to build trust, however, such
                                         “green lanes” for travel. Looking         messages must strike the right
                                         forward, countries might consider         balance between the positive and
                                         implementing repatriation                 the believable—a lack of credibility
                                         agreements with source markets,           will only scare off potential visitors.
                                         allowing travelers to return to their
                                         home countries to recover in the          Finally, it is essential for DMOs
                                         case they still caught COVID-19           to listen to the traveler. Create
                                         with all the preventative measures        a feedback loop for travelers
                                         in place.                                 to provide input on their travel
                                                                                   attitudes and experiences, and use
                                         Such measures are essential to            the information gathered to adjust
                                         making sure their destinations are        safety measures and marketing
                                         safe, and attractive to travelers.        messages accordingly.
                                         But the situation with respect
                                         to COVID-19 is volatile, and              Only by being among the leaders
                                         DMOs cannot rest easy. Instead,           in global travel safety will they be
                                         they must constantly monitor              able to compete successfully for
                                         and update their travel safety            visitors from home and abroad.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                          19
Working with
                    Stakeholders

                                         If DMOs are to carry out their plans to ensure a safe destination
                                         for visitors and effectively communicate its attractions as a place
                                         to visit, they must identify and engage with the key players in their
                                         extended travel ecosystem to deliver unified messages around the
                                         safety measures being put in place. These stakeholders include:
                                           Government entities, including health authorities and road and
                                           transport authorities, are instrumental in making sure health and
                                           safety measures are in place.
                                           Travel and tourism industry players are just as eager to attract
                                           travelers as are DMOs. These include local airports, domestic and
                                           international airlines and hotels, as well as international cruise lines,
                                           traditional and online travel agents, tour operators, and destination
                                           management companies.
                                           Other industry players, such as local transportation companies,
                                           entertainment and event companies, and services like cleaning
                                           companies, also benefit immensely from travel and tourism.

                                         To keep all stakeholders informed         resurgence of travel in their market.
                                         and engaged, DMOs should act as           This could be accomplished in
                                         a clearinghouse for all information       several ways, such as a website
                                         on the health and safety measures         information portal, industry
                                         in place, and provide them regular        newsletter, detailed industry reports,
                                         updates on the prospects for the          Q&A helplines, or live chatbots.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                       20
Conlcusion
                                         Proper health and safety                  travel demand curve and devise
                                         measures, new products and                successful marketing campaigns
                                         services, and alliances with              is the subject of the next report
                                         industry stakeholders are                 in this series.
                                         foundational elements DMOs
                                         must put in place as they prepare         Meanwhile, as international
                                         for their borders reopening and           borders remain closed, DMOs
                                         travel resuming. As interest in the       everywhere need to
                                         destination grows, DMOs must              focus on domestic travel
                                         ensure to activate and accelerate         opportunities, and as would-be
                                         implementation of their targeted          travelers and tourists dream of
                                         marketing strategies to serve the         their next travel experiences,
                                         pent-up demand and capture                DMOs everywhere must act now
                                         market share. How DMOs can                to prepare and ensure that those
                                         use “lighthouse” data and                 upcoming experiences meet
                                         insights to stay ahead of the             travelers’ growing expectations.

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                                   21
Contributors

                                 BCG

                                 Lena Zurkiya | Principal

                                 Konstantinos Konstantinidis | Project Leader

                                 Eric Satzger | Project Leader

                                 COVID-19 Consumer Sentiment team

                                 BCG’s Center for Consumer Insight (CCI) team

                                 Google

                                 Pierric Duthoit | Google, Sector Lead, Branding MENA and Global
                                 Tourism Acceleration Lead

                                 Elie Tabchouri | Google, Industry Head Public Sector & Telco, MENA
                                 and Head of Global Tourism Acceleration Center

                                 Iva Kutle Skrlec | Google, Global Destination Marketing Partner

                                 Joyce Abou Jaoude | Google, Industry Manager, Public Sector
                                 MENA and Destination Marketing Consultant

                                 Mirian Itani | Google, Head of Strategic Partnerships, MENA

                                 Dina Alsamhan | Google, Industry Head, KSA

                                 Katherine Vargas | Google, Communications Manager, Corporate
                                 and Brand Communication

                                 Sara Hamdan | Google, Editor-in-Chief, Think with Google, MENA

                                 Chaza Merchak | Google, Product Marketing Manager, MENA

Consumer Sentiment and the Impact of COVID-19 on the Travel and Tourism Industry                      22
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