It’s been an exciting three days at the London ExCeL this week with the conclusion of Travel Forward. For us here at Unlimint, it was great to find out just how we could help businesses innovate for an ever-evolving and global market.
We have a tendency, in the UK at least, to think of holidays as going to the same tried and true destinations that we’ve been to before. But if there’s one takeaway from this conference, it’s that travel is evolving dramatically.
Whether this is where people are going, or what they want to do, it’s one that has increased, changed and remained relatively robust even in the face of economic slowdowns and uncertainty.
So what exactly did we learn from this event? Well…
Travel Forward – What We Learned
According to the IMF, the global economy is undergoing a slowdown, with growth being downgraded to 3% annually. While not seeming like much, that’s about on par with performance seen during the global financial crisis of 2008/9.
But how does this impact on travel? Not much, according to some of the speakers over the past three days. The industry, overall, has actually been increasing by 1.5% annually, with a total valuation of over $2 trillion.
So what accounts for this continued growth? Technology, the number of passport holders, and a greater propensity to spend more during annual travel.
The US market has surged in 2019
For starters, the amount of people holidaying annually from places like the USA, for example, has nearly quadrupled.
Compared to just a couple of years ago, roughly 42% of its population (135 million) have a passport that they regularly use; a $185 billion market in its own right.
Just two years before this, there were only 21 million passport holders in the United States, making it a relatively small, but growing market made up of mostly domestic and some international travel.
That’s another trend that’s changing, with more Americans travelling internationally, and more often; with 64.1% of all outbound flights being international, and the average passport holder going overseas 2.9 times a year.
One of the interesting trends to note from the US is the fact that while the brick and mortar travel agent are ebbing away, holidaymakers still need the human touch for planning their vacations.
Holiday consultants and advisors have been proven to not only enhance travellers experiences, but also increase their average spending, and frequency of travel – travelling 3.1 times and spending $4,015 compared to $1,687 from those that go without the guidance.
Chasing the Dragon of Asia
We’re seeing the exact same thing from China, which is coming into its own as one of the ‘jet setter’ populations right next to America.
The big takeaway is the fact that, while China is already neck-and-neck with the US when it comes to outbound travel. By 2030, China is poised to rocket ahead with more international travel than any other country, USA included.
What makes China an interesting case is that, compared to the US, only 13% of its population have passports, but already represents a massive market of 200 million strong in 2019. And, according to Xinhuanet, it’s a market that is only going to snowball to even bigger proportions.
With more travellers than ever before, Asian tourists tend to vacation closer to home, with Thailand, Japan and Hong Kong being some of the hot-spots.
With millions more tourists travelling, what’s stopping them heading to Europe, America and Latin America? Localisation and accessibility for them. Businesses that are able to bridge the gap here will really reap the benefits.
Along with being a booming market, it’s a region whose travel bookings are dominated by mobile ‘Super apps’ like WeChat, Baidu, AliPay and others.
To really understand how powerful this market and, by extension, these apps are – we only need to look at California as an example.
Jing Travel, back in July 2019, found that tourism to San Francisco spiked by 30% thanks to advertising campaigns on and easier use of WeChat and Weibo.
Europe’s Dark Clouds and Getting China-Ready
Whether it’s the gathering storm of Brexit or Trump’s influence, Europe is undergoing more of a travel slowdown, especially compared to other regions of the world.
With this in mind, it makes sense for businesses in the travel industry to really get themselves ‘China-Ready’ in order to appeal to an emerging, affluent, and outwardly looking consumer-base from Asia.
Flight Shaming and Ethical Travel
Flight Shaming is on the rise, as influential figures like Greta Thunberg lead the way on raising awareness of climate change.
It may sound like a passing phenomenon, but airlines in Scandinavia have already noticed that it’s caught on; as fewer people book flights, and companies like KLM actively encouraging people to use trains.
While there is a more upwardly mobile generation travelling, they’re thinking far more about the impact of their travel.
There’s a stronger need, for developing regions like Latin America, and modes of travel like railways to really up their game technologically in order to really appeal to an affluent, ecologically-minded consumer.
See the sights? More Like do the Invigorating!
There’s a very clear generational divide on the issue of travel activities too, as Joni Wu of LUXE Travel pointed out: “Millennial travellers are looking for one word for their experiences on holiday – Transformative.”
With this group being more plugged in digitally and becoming more financially capable, it’s a demographic that is working to transform the process of holiday planning, booking and ‘doing.’
Why is that important? Businesses that are able to cater for these upwardly mobile groups, no matter where they are in the world, will be able to really set themselves apart from the competition.
Be sure to keep your eyes peeled for some fast facts on Asia, LATAM, Europe and the USA coming soon!