The Everlasting, Indestructible, Unbreakable Industry

For those of us in the travel industry, the 24-hour breaking-news cycle is a real stress-inducer. What terrorist attack, natural disaster, international crisis, or tweet-storm is going to be next? Will we see a wave of cancellations? How is it all going to affect our bottom lines?

But after a particularly terrible string of events—I can just name-check the places, like Paris, Nice, Puerto Rico, or Hawaii, and you’ll know what I’m talking about—I’ve come to realize that the travel industry is much more resilient than it ever was. Something awful happens, a few people cancel or reroute their trips, occupancy rates drop... and then people start traveling again. Even if travelers temporarily steer clear of certain destinations, their appetite for travel per se is undiminished. They’re not afraid to get back on a plane and continue exploring.

The numbers back this up. The World Travel and Tourism Council recently released its 2017 statistics on the tourism economy and they are, in a word, torrid. For the seventh straight year, our industry was the world’s fastest growing broad economic sector, rising by 4.6%. That’s better than the global economy as a whole (3% growth), and outperformed sectors like manufacturing, retail and wholesale, agriculture, and financial services. Tourism contributed more than 10% of global GDP last year ($8.3 trillion!) and created 7 million new jobs.

But what surprised me the most about those numbers was that some of the strongest growth was in areas like Europe and North Africa, where tourism has been seriously dampened by security fears. The WTTC reported specifically that Belgium, France, Turkey, Tunisia, and Egypt—all of which had experienced terrorism-linked drops in tourism in 2016—rebounded in 2017, much faster than in prior years.

Travel professionals I’ve spoken to agree that the industry seems more resilient these days. “It depends where you’re talking about, but the short answer is yes: Bookings are coming back more quickly,” says Jack Ezon, president of Ovation Vacations. “Cape Town had a real issue with the drought, but now it’s bounced back completely. London bounced back. New York City wasn’t even a blip on the screen after the terror attack there [in October 2017].”

Ignacio Maza, Executive Vice President of Signature Travel Network, believes that terrorist incidents have become frequent enough that they’re, in a sense, less terrifying. “People understand that living with fear has become a fact of life,” he says. “They believe that life is precious but also precarious”—but that’s not preventing them from pursuing their dream destinations. He’s seeing strong bookings for Egypt through this year and into 2019, crediting tougher security, new attractions, and the unceasing desire to see the Pyramids and sail down the Nile.

Travelers aren’t just shaking off terrorism concerns. Mexico welcomed 39.3 million international visitors last year, up 12.1%, despite two earthquakes and incessant reports about crime and tainted alcohol. Miami had a record year despite the threat of hurricanes, and the growth has continued into 2018. Even the Caribbean topped 30 million visitors for the first time ever, with strong numbers in St. Lucia, Jamaica, and Bermuda offsetting the drops in storm-affected islands like Puerto Rico, St. Thomas, and St. Martin.

That’s a very different story from what it was a few years back, when a storm would blow through a couple of islands but the entire region would see cancellations. It means travelers are getting better at understanding how an event impacts different destinations (or doesn’t). And it means that hoteliers and destination marketers are getting savvier about spreading good news. Maza recalls that in the weeks after Hurricane Irma last fall, one resort distributed a drone video showing pristine white beaches and an utter lack of devastation. He encouraged hoteliers in Napa Valley to follow suit following the wildfires there.

So why are travelers—and the travel industry—quicker to recover from setbacks these days? And what lessons can we learn from that?

ECONOMICS The booming economy is probably the most significant reason: people are less anxious overall when there’s more change in their pockets, and therefore more likely to shrug off concerns. Travel advisors and industry leaders who responded to our Pulse of the Industry Survey earlier this year cited positive economic conditions as the main driver of their optimistic outlook for 2018. Even people in less-than-ideal economic circumstances want to acquire travel experiences, and that’s easier than ever, thanks to inexpensive airfares, Airbnb, and the growth in cruising.

Lesson: Keep your product as approachably priced as you can, and make your pricing clear and easy to understand. Be sure to express the value proposition: why it’s worth spending money on this experience. Build flexibility into your pricing model to make sure you can adjust if there’s a sudden drop in demand.

TECHNOLOGY The ease of finding travel information online is another key factor: When customers are more informed, they feel more in control. It’s so easy now for a traveler to discover ideas, do research, and book a trip—all while standing in line at the grocery store. Concerned travelers can learn the news about their destination from on-the-ground sources. Meanwhile, inspiration is constant, especially on Instagram, where beautiful images of other people’s travel experiences drown out any bad news. The ability to personalize a trip and get in touch directly with providers adds to the traveler’s sense of security and satisfaction.

Lesson: Continually invest in technology to ensure you are giving consumers the information, control, and sense of gratification they have come to expect from everything else they do on their phones. Think of how easy it is to call up an Uber or listen to music on Spotify—those should be your north stars.

MEDIA & COMMUNICATIONS Thanks to the never-ending headlines out of Washington, the news media is less likely to dwell on a negative tourism news story these days. But it also can’t be relied upon to give a complete picture. “Media opens the door but they rarely close it,” says Ezon. “They’ll tell you about a big problem somewhere, but they don’t tell you when it’s been solved.” Travel advisors can help fill in the messaging gaps—theirs are often the first phones to ring when travelers are reconsidering a trip, and can put consumers’ concerns into perspective.

Lesson: Present the facts about your destination to your partners in media and the travel advisor community, as well as on your owned channels (website, email newsletters, social media). Don’t whitewash a bad situation, but do provide context to help consumers make informed decisions. Talk about the sophisticated security apparatus at your destination, for example, or explain why tourists are unlikely to be affected. Put things into perspective: Mexico’s murder rate is dwarfed by those in some major U.S. cities, for example. And remember that even if the mass media is exploiting a story, they don’t ultimately control the narrative—you do.

As always, I welcome your feedback on what’s changing in travel today. I look forward to getting your comments. Let's keep the conversation going!