Post-Pandemic Business Recovery
By Anand Srinivasan, CCO, Travel Designer Group
Rapidly evolving travel restrictions, changing consumer preferences and an economy waking up from the pandemic shock. The multiple variables leave many opportunities for travel consultants, who adapt better to the dynamic business environment.
Travel industry’s recovery delayed further by the second wave of COVID-19
The travel restrictions that are in place across the world remains to be the biggest hurdle for the travel industry’s recovery. It is further complicated by the rapidly evolving nature of the travel restrictions and guidelines that brings uncertainty to travel plans. From the Middle East and South Asian perspective, in general, most overseas touristic destinations are closed with no visible timeline for opening the borders. After witnessing the strong COVID-19 second wave in North America and Europe, I believe that there is also a hesitation in Asia to open up quickly.
Though we see several green shoots and opportunities emerging up, right now, finding a vaccine and making it widely available seem to be the first step towards a stable recovery in travel and tourism industry.
The economic impact on consumer spending
There is no denying that the pandemic sent global economy into a shock. Expectedly, the economy has recovered significant losses in the last five months. Still, looking at the contraction this year and the projected growth for 2021, we are pushed back at least by two years of progress. There will be a significant impact on the discretionary spending appetite of consumers. Further, there is a doubt that we might lose a significant portion business travel owing to technology adoption and spending cuts. We must be cognizant of the macroeconomic situation when we make our business plans and strategize for the recovery.
Post-COVID change in consumer preferences
As a travel distributor, we are discussing safety and hygiene practices with many of our preferred hotel chains and standalone hotels, attractions, and transfer providers. We are pleased to hear about extraordinary efforts that are being undertaken. Terms such as contactless service, social distancing, deep cleaning, and digital menus are now an everyday term and though the heightened sense of consumer awareness on safety and hygiene will mellow down in the coming months, I believe that many of these safety measures will remain in place long after the pandemic. As we speak, consumers are still not comfortable to dine out, visit crowded places or travel by air. It is important for travel agents to be up to date with travel restrictions, travel conditions and be able to recommend destinations and hotel properties where their clients can feel safe and enjoy their holiday.
The challenging business environment does not necessarily define the fortunes of individual travel agent businesses
After few months of near-zero business levels, green shoots did show up in all markets. In UAE, for example, staycations started as early as June and continues to generate significant volumes. Travel agents, who spotted the trend early were able to capitalize it. Some of our clients worked with extraordinary precision—identified properties that offered privacy and safety for clients, which are mostly properties with private beach, private pool villas and apartments, worked with us closely to negotiate attractive rates and then leveraged their social media connect with their clients to convert business. When transit passengers started arriving in UAE to stay for 14 nights before leaving to their destination country, we saw huge influx of reservations from some of our clients, who converted this opportunity to a viable business.
Considering the dynamic nature of travel restrictions, opportunities open up and close pretty quickly. Travel agents, who can spot the trends early and have the will to be innovative and proactive will gain.
Next two quarters are critical
As the recovery of travel industry seem slow and gradual, it is important for travel agents to leverage on any business opportunity that may emerge. We are all out of our comfort zones and business is not as usual. Earning a share in the available business will require larger market focus, quicker identification of trends, better technology adoption and greater customer engagement.
In the last couple of weeks, we have some excellent news about availability of vaccine. Once the vaccine is approved and is available for widespread use, the recovery will be stable. What propels the growth of this industry is “Ease of travel”. Over the years, seamless flight connectivity, easing visa conditions and affordable prices propelled this business.
Today, it is not the case and we are not sure how quickly life will get back to normal. Businesses that sails through this phase will be in a good position, post-pandemic.