No doubt, these weeks in quarantine have given you some time to think about the future of your tourism business when travel opens again. (and it will) There is no doubt, validated by research that the tourism business will change. Three areas force us all to relook at our companies because the travelers' needs and perspectives are changing, and we have to reach them. There are factors that will force you to relook at a new target audience, a new customer profile at least in the short term. These factors are travel restrictions, fear and uncertainty, and price sensitivity. We discuss each of them in detail below:
Here are what these factors look like today: (May 2020)
1.Travel restrictions and regulations and uncertain dates:
-Return of domestic and international flights has an uncertain date of return and these dates will be staggered by type and by country. For instance, domestic travel will, in all likelihood, return earlier in your business area than international traffic. Also, due to regulations, some visitors from specific countries will be allowed in, while others will not. It depends on the stage of the virus in each country.
-The re-opening of borders – beyond just airline traffic- highway, boat traffic from country to country, and province/state will vary.
- Timing of businesses opening again – and where does tourism fit in with regards to essential or non-essential services? When and what type of tourism businesses will be allowed open?
- Every country is at different stages of social distancing, lookdown, and opening, and this will continue for some time.
Implications for your business: If your current target customer profile t is from a foreign country, a local, domestic traveler will likely by your only option for an uncertain amount of time. You will need to adhere to new cleaning procedures and modify the number of travelers. Today, China is opening to local tourism only, as well as Spain by May 11th. As travel restrictions continue, lack of widespread and valid testing, and the absence of a vaccine, international travel will be restricted from various countries in stages.
2. New needs of travelers will change and form - fear and uncertainty of travelers
We are changing as humans because of the impact this virus has on us. Fortunately, many research studies are evaluating the mindset of consumers and how and where they want to travel. Here are a few highlights:
- Even when air travel continues – Every travel business will need to reassure safety and cleanliness to worried passengers –70% of Americans, and 54% of travelers surveyed from the U.K. associate air travel with getting sick. Modifications to air travel procedures will need to be made for these travelers to get on a plane again. 2020 Phocuswright Study
- Values for many travelers will change – Our values will shift from a focus on image and luxury to values of safety and responsiveness. Companies that focus on a clean and safe environment, and responding quickly to issues- will survive and build trust with their gusts. -April 2020 Smart travel lab – Kantar
- Local travel and staycations will accelerate – Regulation, fear and cabin fever will drive travelers to focus on getting away from the main city centers into nature and controling their surroundings that guarantee hygiene like driving their own car which will reduce anxiety from the fear of infection.
Implications for your business – Relook at your target audience, and what you offer them now. How can you eliminate their fears of getting sick? How can you tell and show them how you take their concerns very seriously? You will need to change your copy and communications to meet their needs. Monitor what countries are opening up to see how they are managing shifts in perspectives. If your primary target customer profile is from the U.K., but the borders remain closed to your country – this will force you to target different people from different countries, and potentially a local market in the near term. What can you offer them?
3. Price Deals and Price Sensitivity of Travelers
Pricing is going to change in the short term and long term in travel because of several major factors:
- Widespread job loss and income will make travelers more cautious in the short term and it will impact how much they are willing to pay; for instance a staycation in their home country and shorter trips will be more palatable than longer, luxury, and international excursions. Some travelers will 'wait and see' due to health fears and choose shorter and closer trips and the demand will change. This shift will also have an impact on costs.
- Tourism companies and airlines will advertise crazy low prices in the short term – They will be desperate to get travelers back after travel is open again. This activity will be short term. It will be impossible to sustain low pricing long term in a low margin industry like tourism.
-Longer-term, the impact of the bankruptcy of airlines, hotels, and attractions will drive up costs, and if regulations and safety require them to book fewer people for their services to satisfy distancing measures, costs for travel companies will increase. Unfortunately, travel will most likely become more expensive vs. pre-COVID, and it will not remain accessible for everyone. To add to the challenge, the virus has caused a deep financial crisis, and the disposable income for many travelers will not improve for some time.
Implications for your business: Pay close attention to the price sensitivity in the market, how it will change, and do your research on pricing comparisons. Don't assume that low prices is what all travelers are willing to pay. We may see short term discounts, but they will level off. For example, there are many free and low price virtual tours for sale online. It's a new medium for tours, so the industry is figuring it out, and testing the waters. The better the tour, the higher the entertainment, education value, the better the reviews- the higher the perceived value that viewers are willing to pay as virtual tours continue, they will get pricier. Viewers are commenting on how low the prices are and the high value! Lower pricing will not win in the long run. The more you stay in touch with the market dynamics, the better you can manage your profits of your business. My bigger questions is: What will the future of luxury tourism look like?
Understanding the new needs of your post COVID guest is critical. If you don't understand the needs of your guest, you can't effectively market to them.The more you can persuade them, the more of a chance they will buy from you.
Do you need to develop a new target customer profile Post-CoVID-19?
All the factors mentioned above will require tourism businesses to look at their target audiences. Most likely you will need to shift to a new audience, at least in the short term.
Here are some new target customer profiles to think about:
a. Local daytrippers, domestic instead of International travelers. – This the most likely scenario for a target audience post Co-vid because of regulation and the fear of traveling too far, and if your target market was traditionally foreign,a domestic target could vary in language, and in different needs. Local travelers may like to do different things, and pricing may be different. For example: If you historically offered a city tour, a domestic, local traveler may more likely book an adventure that is not easily accessible, and not somewhere they can get to in their own car. Do you have a few packages, rooms, or attractions to appeal to them?*
There are different subgroups within the domestic traveler to consider:
b. Families with kids – It's a guarantee that some parents will want to unleash their kids to enjoy some activities that they don't have to organize, manage, or monitor. And after being trapped indoors – nature and the outdoors will play a key role in their travel decision.
c. Retired and semi- retired travelers -This group will either be very worried by the crisis, and will wait and see what happens for several months OR they will be the first ones on the next plane because to them "life is too short, let's go traveling again." As long as you provide offers relevant to them (i.e. cultural and low impact adventures). This group over-index on the use of Facebook, and you can target them easier with ads, based on their demographics and key brands they use.
d. Expats and digital nomads – There are groups of foreigners who may be an option to target since they are already in the country and looking for something to do. For example, I live in Medellin Colombia right now, which is a hotspot for retirees, as well as startup companies and individuals and groups who live and work online here. A lakeside hotel in a nearby town advertised their services with a call to action "Come stay and recharge in nature after the quarantine" – and they received hundreds of responses and bookings. Don't forget that local Facebook expat and digital nomad groups are a great place to find prospective buyers. (just check their rules for promoting)
e. Students- The younger generations are no doubt having a tough time coming to terms with their canceled plans, and they aren't spending money like they used to, as they are cooped up at home. In some studies, this group will be the most anxious to say YES! to travel quickly after the crisis is over.
f. The Business Community – There is no doubt that many companies are challenged to bring their businesses online and work from home. Business planning meetings to unite their staff on key goals were cancelled, and these kind of events are often a reward for employees. Cities around the world are missing the extensive income generated from these offsite business meetings. Look for opportunities to connect with businesses in your trading area to support them when travel is back, and reach out to past contacts to share with them a future opportunity to work with you again.
g. Occasion: Communicate the needs and emotions of missed celebrations – Not only should you look at target groups, but also look at occasions to market. Many celebrations have been missed by travelers – like graduations, birthdays, anniversaries, weddings and reunions – marketing directly to consumers who have missed these occasions can be very useful to tap into their needs and their emotions. Facebook can be a very effective tool to advertise to people on these occasions because you can directly target past birthdays, engaged, and anniversaries within the targeting functions.
*Thanks for the opinions and views from the Covid study from Toluna/Harris Interactive April 2020, Chris Torres- Digital Tourism Show, and Arival Webinar April 21 tourism insights
How do I start defining my ideal target market?
Here are the key steps:
1. Start with a hypothesis.
If regulations and the trends above continue, think about what kind of guests will most likely want to buy your tourism products? Based on the above, list as many types of people you can think of that could best fit your brand.
2. Pick 3-4 of these groups to review in more detail.
No business appeals to everyone. Nor do you need to sell to everyone.
3. Interview some guests that fit into your hypothesis.
– i.e., local families, ex-pats, etc. Ask questions of prospective guests to get a better picture of them, so you can better market to them.
Set up a call and ask these questions from this questionnaire. (download here)
You will ask questions about their background, Their likes and dislikes, Their Interests, Their "pain" – these are the problems you can resolve for them, How they plan their travel.
If you want to run by types of products you can offer to them, ask those questions too. For example: If you are going after a new local and domestic audience, ask them what kind of products will most appeal to them AND what needs you need to help them with to maintain their interest.
Use your findings and develop a summarized description of the person(s). This will better help you hone in how to market to them. A guest persona is simply a summary of the information you collected that you can use and share with your staff to the best market for them.
A guest persona will make your life much easier because it will help you develop:
-Facebook and social media posts
-Better customer service responses to your guests
-Email marketing that doesn't get deleted
-Advertising and sales materials
-Tours, or amenities you offer, the types of events you run
5. How to Design Your Guest Personas:
You can do this in several ways.
- Use software to create it. Like Uxpressia.
- or feel free to use our powerpoint template to design your template(download)
You have to ask real travelers, or you will never get the information you need to best target your ideal target audiences. By going through this process, you may find some exciting things happen:
1. You may find some commonalities with different guests (like their needs or their fears)
2. You may also find that you may attract your secondary or tertiary guests anyway because they may connect with your business, and what you stand for, (your WHY -- which we will talk about a lot more later) and the genuineness of your communication
3. Your priority, however, will be to communicate with your primary guest.
4. Important points about your ideal guest
- Often mindset, interests, and behaviors will be a more significant factor than their demographics to appealing to this consumer.
- Don't get caught up with a specific age (range)
- Focus on the person with the mindset, attitude and the stage they are in
Download the resources, and start working on your new target customer profile. How did you make out with your new guest persona? Let us know, and you can find more tourism marketing resources here.