Article written by John S Kim, CEO of Sendbird
COVID-19 has put the travel industry on a roller coaster, and now inflation threatens to keep the ride going. After two years of empty hotels and airports, travel has increased again. Adventurers have taken advantage of incredible deals and luxury experiences meant to bring consumers back to the roads, skies and waters in droves. Then suddenly, after so much money had been sucked out of the travel industry for months, the free fall was over and brands hurt by the pandemic sought to make up for their losses by raising rates and room rates. . Consumers have been more than willing to pay.
Take the airlines for example. In its April 2022 report, the Adobe Digital Economy Index found that domestic flight bookings increased by 28% in March 2022 compared to pre-pandemic levels (compared to March 2019). And in the first three months of 2022 alone, consumers spent almost half of 2021’s total for the year – and that’s before travel presumably heats up for the summer.
According to the US Travel Association’s latest monthly travel report, six in 10 Americans are planning at least one trip this summer — and there are plenty of places to go. AirDNA, a short-term rental data company, noted that 58,000 new rentals were added to the market in January 2022, the biggest addition to supply in a month since the pandemic began. There are now 1.5 million listings available nationwide, the highest ever.
Additionally, the World Travel & Tourism Council (WTTC) updated its economic modelling, predicting that U.S. travel and tourism would exceed pre-pandemic levels by 6.2%. That would represent nearly $2 trillion of US gross domestic product. Beyond US borders, data from the council shows summer 2022 bookings in Europe have already exceeded 2021 levels by at least 80%.
Clearly, travel is on the minds of American consumers. But do we just get to another peak on the rollercoaster, a new peak before taking another big dive?
Does Inflation Dampen Excitement?
Before travelers have had a chance to take full advantage and explore their travel options, they have to contend with higher prices for airfare, gas, hotel rates and even food – not just because of brands seeking to compensate for what has been lost, but because of a sharp rise in inflation. Over the past year (April 2021-April 2022), inflation has risen from 4.2% to 8.3%, raising fears of a recession, which could have a significant impact on travel spending in India. coming.
A recent survey by Bankrate.com indicates that almost seven out of 10 people will change their plans in some way because of inflation. This does not mean, however, that all bets are off. The survey further revealed that the demand could outweigh the price. So what can a brand do to avoid another tailspin during what should be its peak travel season? This can ensure that the experience is worth the investment.
New levels of customer service – even before a trip begins – will be needed to connect with travelers and retain them for whatever lies ahead.
Le Fouquet’s Paris has an excellent reputation for service and the ultimate luxury stay – a reputation that has earned it legions of fans who will return again and again. He has earned his reputation, in part, by his attention to the little things, the things that matter to customers and stand out in their minds as exceptional, even in their mundaneness. The hotel is known to send out a questionnaire to guests to find out their preferences before a hotel stay, asking questions about everything from bed preference to music to fruits and drinks they love. Everything a person could want in a hotel has been taken into consideration to create the perfect stay.
Today, people are looking for curated experiences, even if they aren’t looking for high-end French hotels. Travelers want to be more than a number; they want Fouquet’s attention to detail wherever they are. Fortunately, it’s easier than ever for travel brands to provide services that make them feel like part of an exclusive community.
When the right experience is created by a brand, it evokes feelings of joy and decadence in travelers. After feeling so overlooked and invisible for so long during the pandemic, people continue to be willing to pay for personalized travel with attention to detail, even if it means cutting back on expenses in other parts of their lives. .
Forge human connections with the help of technology
One of the keys to success is keeping the lines of communication as open and fluid as possible. Technology – especially mobile apps – makes this remarkably simple. Whether online, via chat or with video calls, travelers can be instantly connected with someone who can cater to their whims or answer their questions in the moment. The right tools can make travelers feel like they have a concierge in their pocket.
Brands that offer increased personal services at no additional cost via technology are in the best position to withstand any kind of inflationary pressures. They even have the potential to sell services.
Travel brands can use technology to engage with customers throughout the lifecycle of a trip – from planning stages to post-trip follow-up. For example, a brand can connect customers with other travelers who can share their experiences with different travel options in an online community or group chat, or perhaps new communication tools can be used. to find upgrades.
Because discovery and reservations are more closely linked than ever, technology can enable brands to create seamless experiences in collaboration with partners. For example, in a hotel app, a guest can book a room and add excursions, make dinner reservations nearby, and more. Enabling such integration not only saves travelers time, money and hassle – making them more likely to increase their travel spend and/or book future trips with the same brand – but allows also for brands to forge alliances that can include referral returns that increase revenue at a time when every dollar counts.
Once a trip is underway, guests can use the one-tap call from the hotel app to book a massage from the golf course or ensure champagne or clean towels are waiting in bedroom. Similarly, brands can follow up with customers after their trips, via an online portal, video call or integrated survey to ensure everything was satisfactory and offer help with planning future trips. Technology offers a way to close (or even extend) the loop in a very personal way that makes customers feel valued.
As the travel industry tries to regain its footing while facing fear of another major economic downturn, brands must find innovative ways to make the road a non-negotiable, something consumers don’t want. happen. The best way to do this is to create unforgettable experiences that engage people and make them feel special. Technology is the best enabler, facilitating quality interactions that make life easier and more enjoyable overall. This is the best way to ease the pain that consumers are hitting in their wallet.