There can be no doubt we are now firmly on the road to recovery in our industry – with business travel accelerating in the wake of the returning leisure sector. Research from McKinsey finds thousands of travelers will be hitting the road this year ‘no matter what’. People love to travel, and, despite two challenging years, they will continue to do so in the long term.
There can be no doubt we are now firmly on the road to recovery in our industry – with business travel accelerating in the wake of the returning leisure sector.Research from McKinsey finds thousands of travelers will be hitting the road this year ‘no matter what’. People love to travel, and - despite two challenging years - they will continue to do so in the long term. Yet, some uncertainty is still challenging this wanderlust, so how, then, will these two opposing forces interact – will demand overcome uncertainty and what will the future of travel look like?
Shifting consumer behaviors
There have certainly been positives recently. This month, the UNWTOrevealed it had recorded steady growth in international tourism arrivals over the first half of 2022. Amadeus’ own data confirmed this – in April, average hotel rates were three per cent higher than in the same month in 2019, and air distribution bookings are growing closer and closer to pre-pandemic levels every quarter. It is clear, despite the challenges, travel is back.
But we must not assume the new world will be the same as the old, that we can behave as we did before. Consumer behaviors have changed over the last two years, in some cases faster than we have ever seen before. Accenture, for example,interviewed more than 25,000 people , with half saying the pandemic had caused them to re-evaluate their ‘personal purpose,’ to reconsider what is important to them. This, naturally, has had an impact on how they consume, as they apply new preferences to what, when and where to spend. Similarly,research from Google suggests people are putting their money where their values are. There have been sharp increases in searches for ‘ethical shopping’ and ‘ethical brands,’ for example, with consumers moving beyond price to consider products that are more in tune with their aspirations. Finally, a new ‘digital normal’ has emerged over the past two years. During lockdown, suddenly, everything was available online and convenience became a key differentiator.
Coming back to business
So, what does this mean for travel – and how will we react? Three trends currently stand out. Travelers now want to ‘make the most’ of a trip. Our search data shows people are looking for epic destinations, longer trips – they appreciate the value of travel more than ever before. At the same time, sustainability continues to rise in importance. Climate change has become increasingly important over the past two years, with both business and leisure travelers seeking greener options in response. Finally, we have witnessed an acceleration in demand for simplicity. Digital convenience has increased, but travel has become a more complicated activity to master. In response, travelers expect providers to reduce the complexity of travel, to make it as frictionless as possible.
The seeds of these trends were evident before COVID-19 – but they were not as urgent. What the pandemic has done is accelerate all facets of our society. During the ‘ComeBackToBusiness” event Amadeus recently hosted in Nice, finally face to face again with our partner Lufthansa City Center, I explored three strategic priorities when it comes to servicing the travelers in the future:
- Be connected
For years we have discussed breaking down silos within the travel industry – and this task is now essential. We must launch a process of radical collaboration to create truly frictionless travel - we need connected, cloud-based solutions, now. We can no longer afford to have visibility over just one part of the journey, we must view a trip through an ecosystem prism and create the digital platforms that make this possible.
- Foster individualization
This matters more than ever. We have previously talked about personalization, but individualization is one step further, using real-life and faster-than-life services driven by the situation on the ground. Personalization is to offer a customer the same preferred window seat that they had on the flight one week ago. But individualization - when we take it all the way through - is offering indoor activities to a family on their vacation when it is raining. It is knowing the traveler and responding to their needs.
- Support sustainability
We see a major shift in awareness and a willingness among travelers to adapt behavior in response to the urgent climate change crisis. According to the World Travel &Tourism Council (WTTC), 83 per cent of global travelersthink that sustainable travel is vital – a sharp increase. We must respond accordingly.
Providing the best environment for success
Amadeus has a clear vision to respond to these changes – to help customers like Lufthansa City Center and others create connected, individualized, and sustainable trips for both business and leisure travelers.
We are working to further advance our platform, so that airlines, travel sellers, corporations, airports, hotels and payments businesses will be running in a unified environment. This will increase reach, connecting data from many different points in the industry. With this much deeper level of connectivity, it is Amadeus’ goal to help the powering great journeys whose different elements from many different providers are linked automatically throughout all touchpoints.
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