23 March 2020
Safe travels in a changed world
The travel industry is in turmoil amid the COVID-19 outbreak, with aircraft grounded, bookings sharply down and hotel occupancies at rock-bottom. But it will eventually bounce back, just as it did following SARS (Severe Acute Respiratory Syndrome) in 2003. Jenny Lo, General Manager of branding and marketing consultancy CatchOn in Mainland China, whose clients includes Six Senses Hotels & Resorts (main picture) and Mandarin Oriental, discusses how destinations and travel companies can recapture outbound mainland travellers amid a pandemic to initiate a speedy, sustained recovery.
What are the biggest challenges the mainland travel industry faces right now?
It is bracing for the magnitude of the impact, and making sense of the uncertainties ahead that may impair recovery. The outbreak started in the mainland during one of the country’s peak travel seasons, resulting in millions of cancelled trips. While an end to the mainland’s epidemic might be in sight, Europe and the United States are going into lockdown. The situation is fast-changing and the effects have now become multi-fold, making the road to recovery even harder and longer.
How can destinations-travel companies recapture inbound mainland travellers?
Businesses may leverage on the power of technology to stay relevant to consumers by strengthening brand equity and preparing to move forward after the crisis. People may not be travelling now but they will soon – and when they do, brands that remain uppermost in their mind stand to gain the most.
Destinations and brands may need to quickly reposition, review their offerings and develop strategic partnerships to meet the changes in consumer demand for their newfound interests. Mainland tourists’ travel tastes are likely to change, inspired by a desire for a healthy lifestyle, a sense of purpose and family-first priorities.
Extended school closures have also kept the mainland’s 276 million students at home, and their performance-oriented parents pondering how to catch up on the lessons missed. This offers an excellent opportunity for destinations and travel companies to design and market new experiences targeting young travellers.
How long might it take for the travel industry to return to normal?
The current situation demands everyone to adapt to a new normal every day, and such uncertainty comes with an unprecedented challenge. We are hopeful that people will start travelling short-haul again in the summer subject to changes in travel restrictions.
It has been a testing few months since the outbreak began. Why should tourism companies in the region be upbeat?
To survive and thrive in turbulent times, we need responsive and timely strategies. The travel industry is not going to settle back to normal overnight but likely in phases, so it makes sense for the industry to start planning ahead to recapture the markets and explore new opportunities, starting with countries that have (almost) recovered from the epidemic.
The good news for everyone is that travel is cited as one of the top things consumers currently crave the most. It delivers a promising message to the industry that people will start travelling again, as panic subsides. The SARS outbreak in 2003 gives us some level of assurance and confidence – businesses bounced back, and hotels recorded an immediate, sharp increase in occupancy as soon as the World Health Organization lifted travel advisories. Losses were succeeded by nearly instant gains, bringing minimal impact to annual profit margins.
What can the experience of living through the coronavirus teach us?
Travellers will now be more concerned about health and hygiene and more alert to other potential health issues like seasonal flu. This is prompting travel companies to consider services that address these concerns, from providing disinfectant kits on flights to serving immune system-boosting juices at hotel check points. Demand for wellness travel may rise too, as people develop a growing interest in holistic programmes and experiences that address not only physical health, but also mental and emotional wellbeing, opening up more opportunities for wellness hospitality pioneers.
As the number of cases drops in the mainland and remains relatively limited in Hong Kong, do you think the industry will be better-prepared if something like this happens in future?
We must applaud the collective, immediate efforts among the travel industry players for their engagement with travellers, and destinations’ carefully crafted, context-sensitive content, like Dubai’s Burj Khalifa’s Wuhan Jiayou (Wuhan, stay strong) lightshow, as well as online platforms’ cloud-based virtual-tour initiatives. Ctrip launched one that grants travellers free access to a few thousand attractions in the mainland and 48 other destinations.
With some parts of the mainland locked down for the earliest part of the year, do you expect a boost as people make up for lost time?
This is the expectation. The desire is always there, and growing. While cautious about the exact travel schedule, a survey released last week indicates that close to 90% of the respondents plan to travel this year, one-third of which are looking at a summer holiday in July and August. We expect to see the pick-up to start with domestic travels and short-haul trips (subject to changes in travel restrictions) in the next peak travel seasons.
Do you anticipate that the travel industry will face similar pandemics in future?
I sincerely hope not. However, the pandemic has highlighted the importance of being prepared. This includes building business resilience, strengthening operational structures and having strong communication plans in place for consumers, employees and investors to maintain confidence in the business.
What are your predictions for the travel industry in the region over the next 12 months?
It will be focused on recovery and developing new strategies for the upcoming decade. One thing I can say for sure is that, on the consumer side, the reluctance to travel is only temporary.