Miha Bratec, Dejan Križaj, Jaka Godejša, Tadej Rogelja – AIRTH & University of Primorska, Faculty of Tourism Studies, Turistica
Introduction
While most people would agree that 2020 was the worst year in the modern history of tourism, and looking at the sheer numbers would confirm these claims, we at AIRTH will try to look beyond the obvious and offer a more balanced view of the lessons and trends that this pandemic helped triggering:
1. Overtourism is stopped and there is a real opportunity for sustainable change.
2. The high-spending, price-insensitive business segment is gone.
3. Flexible booking conditions are the (new) norm.
4. Consumer-centric services are needed more than ever.
5. Forced technology adoption is just the beginning of digital transformation.
6. Local and domestic tourism is the more resilient one.
7. Regenerative/transformative travel is up-and-coming.
Let’s start with the positive!
1. Overtourism is stopped and there is a real opportunity for sustainable change.
We would even dare say – overtourism is gone! At least for the unforeseeable future.
Strolling along the promenade of the seaside town of Koper (Slovenia) this spring, one would often hear a passing couple say, “Look, what a crowd!”. But in reality, there were only five people approaching from the opposite direction …
This suggests that the perception of crowds and masses changed in people’s minds during the pandemic and is likely to continue to do so in the future. For instance, where crowds once used to be 100 people, now even five people are considered as such. All of this is also slowly seeping into people’s subconsciousness as the media tells us at every turn there should be “no crowds, no gatherings, no masses, you’re grounded etc.”.
Though it started as a temporary, pandemic-induced security measure, the trend of social distancing will continue, as various tourism stakeholders have become fed up with crowds, overtourism, and all the inconveniences they conjure. People are therefore looking for more sustainable forms of travel and visitor flow management.
The pandemic gave us a chance to reconsider and observe how a world that we longed for would look like in practice. For example, (1) when Venice briefly reopened in the summer of 2020, fish swimming in clear canals and a more peaceful atmosphere were just some of the perceived benefits. (2) In the first half of 2020, CO2 emissions fell by 8.8% compared to the same period in 2019, which is even greater than their decline during the 2008 financial crisis and the 1970s oil crisis (Potsdam Institute for Climate Impact Research – PIK).
Other trend forecasts found in the media and research reports clearly show that types of tourism involving large gatherings (group-based) will most likely be in decline (school trips, cruises, religious tourism, group travel, mega-events, MICE tourism, shopping, etc.). In contrast, nature and wildlife are expected to triumph. The hills, seaside resorts, wildlife reserves and somewhat remote and isolated places will win over the crowded destinations. Road trips will become more popular (RVs, cars, bikes of all kinds, …).
Most want to slow down or pursue either long forgotten or banned passions, so biking vacations, sailing, walking, hiking, fishing, etc. will re-emerge as reasons to vacation. Health farms, spas, nature villages, etc. are newer options to branch out to.
2. The high-spending, price-insensitive business segment is gone.
Now we come to the more negative aspects of COVID. The most affected form of tourism, which will also require the longest recovery time, is undoubtedly business travel, especially conventions. Unfortunately, this segment has also been the most lucrative one for all those involved in tourism, as it tends to be price-insensitive and yields the highest spending.
In fact, it is doubtful that this segment will ever return to pre-COVID levels. Why? Simply because the entire business world has realized that (once not so attractive) online meetings can be just as productive as face-to-face meetings, and you don’t have to fly halfway across the continent just to attend a conference or a simple partner meeting.
Business, aside from tourism, wasn’t truly affected when travel stopped and lockdowns occurred. So why should business travel be deemed necessary again, now that we have learned how to efficiently conduct (most of our) business and negotiations online? However, since humans are social creatures and we still enjoy being with colleagues and partners while also seeing an occasional trip as a business reward, we expect the recovery of incentive-driven travel to occur and resume much more quickly once health concerns become better manageable and meetings in public spaces are an option again.
Ultimately, the road to recovery in all sectors is long and winding, and for now, tourism managers should innovate by either (1) entering the growing online service ecosystem or (2) repurposing physical facilities by, for example, focusing on leisure segments that will recover more quickly whilst converting conference rooms into retail outlets, thus making places more attractive for vacation and relaxation rather than (just) workshops and training.
3. Flexible booking conditions are the (new) norm.
In times of great uncertainty, when situations and constraints change daily, travellers need full flexibility. Full stop. And so flexible booking conditions that allow for cancellations and last-minute changes are the new norm.
Unfortunately, this means that already cash-flow-strapped tourism suppliers have little opportunity to generate upfront and guaranteed sales, as these would further negatively impact the already low demand. Labour costs for reservation departments are rising, but there seems to be no solution in sight until times properly settle down.
Even then, will advance purchases and non-flexible fares that were the norm for anyone looking for good value travel deals, be accepted by the customers once again? We’re betting on yes, but the differences between flexible terms and non-refundable deals will have to be more pronounced than in the past. Long story short, say goodbye to guaranteed sales for now and say hello to being forced to offer steep discounts when the time finally comes to reintroduce them.
4. Consumer-centric services are needed more than ever.
In a time when our daily lives are governed by strict hygiene protocols and every entry into public spaces requires us to change our usual behaviour by following prescribed guidelines, the carefree holiday feeling is often hard to find. This makes it all the more important that the tourist service providers, even if camouflaged and after millions of security measures that they can hardly get their hands on, increase their gestures of hospitality and a warm welcome to the maximum.
Guests had a lot to overcome before they could travel, and the last thing they need once they arrive at their destination is a kind of “military treatment” by their hosts, who try so hard to follow the newly imposed safety rules and recommendations that they forget that they are there first and foremost to meet the guests’ needs and even pre-anticipate them. In times when safety is an additional, but by no means the only factor in the discussion about perceived service quality in tourism, it is more important than ever for tourism businesses to think consumer-oriented and tailor their services to the individual guest.
5. Forced technology adoption is just the beginning of digital transformation.
OK. We’ve all read about the massive changes COVID has brought to tourism and hospitality businesses when it comes to adopting new technologies. While it has certainly accelerated the processes of digital transformation, which the sector has traditionally been highly sceptical of, those of us with a little knowledge of tourism and technology may also roll an eye or two.
In truth, the vast majority of the industry has only adopted solutions that have been around for over 10 years, such as contactless check-in and QR-coded digital menus. But have the industry’s business models properly evolved to thoroughly embrace the new possibilities enabled by cutting-edge technology?
Not really, most QR codes lead us to PDF menus that provide lists with dishes and their prices that are just as static as their paper counterparts before March 2020. For us, the innovators and business model geeks, true digital transformation will not begin until the QR codes lead us to menus that incorporate at least some form of dynamic UX and business model engineering. For instance, by introducing Dynamic Pricing as the first steps to implement the principles of Revenue Management not only in the airline and hotel sector but also among food and beverage outlets.
6. Local and domestic tourism is the more resilient one.
In recent decades, international tourism has been lauded as “the good”, “the rich”, “the economically viable”. A weekend in London, season-opening in Ibiza, main summer holiday on the French Riviera, a hike or two in the Austrian Alps, end of summer on Mykonos and an autumn trip to Morocco or Israel to catch a few last splashed of summer and prolong the tan for the winter – a typical scenario of many European urban middle classes.
As travel and mobility became part of the weekly work routine, flying abroad became as common as taking the subway or train to work, and vacationing in one’s own country was something completely passé, something reserved only for the “boring, older and/or unfashionable” crowd. And then comes 2020, and staycations and holidays “at home” become the norm for most.
People discover the beauty of the places that surround them, where they never bothered to go before, and suddenly domestic tourism becomes sexy again. Not just sexy, economists are quick to note, because while it’s not as lucrative as international, it’s the one which is much more resilient. And environmentalists are overjoyed at finally being heard. And yes, countries that have invested decades and millions in strategies to focus on international markets are suddenly in big trouble and beginning to rethink … and wonder where it all went wrong.
7. Regenerative/transformative travel is up-and-coming.
After months of the dreary and monotonous lifestyle we have been experiencing, we predict that people will try to take charge of life again. From being passive observers of the crisis our society went through and is still going through, to actively engaging with the world. The pandemic has disconnected people from the things that matter most – relationships, experiences and communities. Travellers in 2021 will strive more than ever to connect with locals, to experience something new that will have a lasting impact on their lives while contributing to the local communities they travel to.
For each individual, transformative travel can be something different. One of the examples could be to immerse yourself in the culture and engage with the locals – you could learn how to bake the traditional Slovenian pastry potica from a local. And for more potentially transformative and certainly regenerative experiences, like the ones that AIRTH mentors thrive from, visit www.localsfromzero.org
That’s it!
To sum up: Let’s not go over the limit again, let’s stay flexible, people-centred, innovative, transformative and regenerative!
HOW TO CITE:
Bratec M., Krizaj D., Godejsa J. & Rogelja T. (2021). AIRTH’s take on 2021 signs of change. In AIRTH Encyclopedia of Innovation in Tourism and Hospitality. Retrieved: <insert-date>, from http://www.airth.global