Industry Update
Opinion Article13 July 2020

Inflection Detection: How Travel Brands Can Discern And Capture Upswings In Demand

By Carolyn Corda, Chief Marketing Officer at ADARA, Inc.

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Very few people are traveling now, but the $2.9 trillion question is when will people start booking travel again. The World Travel and Tourism Council (WTTC) predicts that a staggering 197.5 million travel and tourism jobs are at risk of being lost if travel restrictions are only lifted after the summer - an alarming 96% rise from the most recent prediction of 100.8 million jobs. As a result, there is constant pressure on brands to make every day count, to mitigate the fallout and to get the travel industry back on track.

In anticipation of increasing demand, different travel companies are positioning as best they can to capture it. Hong Kong flagship carrier Cathay Pacific announced at the end of April that it had plans to increase flight frequencies and reinstate key Asian flight destinations, beginning from the last week of June.

The signals of a rebound are likely to be market-specific and subtle. Countries in Northern Europe are slowly opening, but most international travel is still restricted, and so a hotel rebound will be slight, at first, while air travel could lag further. Over in Asia Pacific, plans to establish travel corridors between countries such as Australia, New Zealand, Singapore and Indonesia are emerging as governments begin to ease restrictions against the coronavirus. However, authorities are taking a cautious approach, prioritising essential travel for businesses and official purposes.

Elements such as trip purpose, advance booking window, length of stay, class of service can all be examined to understand which types of travellers will bounce back first, and when. But, these signs must be read cautiously. There are also major health and economic forces at work, and outcomes across regions and countries will vary widely. The future will be subject to structural changes that could alter travel for some time in addition to normal traveller demographic differences and individual traveller emotions.

Don't expect a single curve

Travel, perhaps more than any other industry, will suffer long-term effects of the coronavirus pandemic. With past travel downturns, there were smoother patterns that could be seen across the industry. Structural changes like limits on capacity, sanitation regulations, testing requirements, and border closures, could all come and go as the virus comes and goes.

There is a danger that travel marketers try to create a single timeline of the future, with a unifying outcome. Looking at travel booking data from ADARA, there are small signs of increases, such as US leisure travellers booking 90 days out, and travellers in South Korea continuing to travel more than their neighbours. But, these small inflection points will not add up to a single bottoming out of the curve that will then smoothly bounce back up. There will be fits and starts and small spikes that then turn back down, where each slice tells its own story.

Plan for several scenarios

Major gating events such as infection rates and shelter-in-place orders are the tip of the iceberg of the factors different travel brands need to understand. Tourism locations must know how many people can gather in one place, and if major sports teams will be able to play. Airlines will need to understand border crossing regulations, and the emotional willingness of people to travel while sitting next to strangers, not only on the plane itself but also across hundreds of airport lounges. Hotels will need to understand how to entice visitors when large gatherings like conferences and concerts are dramatically reduced, and how to manage elevators and other public spaces.

Each industry must create scenarios that examine each layer of gating events across different timelines. Companies are putting a lot of analytic resources and executive attention into laying out potential futures, whether it is an "U" or an "L," and creating action plans for marketing, staffing, and capacity management based on the timing and strength of the rebound. One key unknown is whether the virus returns in the fall, which could dampen longer term travel. For example, a recent survey shows that 40% of university students are considering changing their study abroad plans for next year. Each scenario requires different actions by the travel marketer. Travel brands will be well served to play these scenarios through.

Information is power

Widely-held assumptions about how travel is likely to rebound over the course of the next 12 months are emerging. For example, international travel is expected to lag behind domestic travel, and outdoor destinations such as national parks are expected to be more popular than other attractions that tend to draw dense crowds. Further, the bet is that unmanaged corporate travel will come back before managed corporate travel, and that senior leaders will likely travel sooner than their junior counterparts. All of these forecasts seem logical and align with early indications of consumer sentiment. And, many of these trends may indeed prove to be true.

However, it is particularly important to challenge logic when there is a lack of historical precedent. ADARA insights revealed some actual consumer behaviour that defies some seemingly logical assumptions - the notion that people will avoid destinations that cater to crowds is also proving to be a false one. A contrary indicator is Las Vegas, which is seeing a nearly 200% uptick in bookings for late summer.

Travel marketers can use data from many companies that are making data publicly available to help with scenario planning including Smith Travel Research that tracks hotel performance, International Air Transport Association which provides scenario forecasts and BCG's Travel Recovery Dashboard that provides a snapshot of key indicators. ADARA has also created a free dashboard with consumer intent and booking trends for travel with additional data for other discretionary activities such as dining and entertainment rolling out soon. Other leading indicators, such as an increasing radius in the distance people are booking travel from a specific city, or the increase in originating locations to a destination, are good signs of a trend. It is important to have a shared cross-functional plan for the company to coordinate go-forward messaging, media buying, pricing and service as micro-trends arise.

Creating light at the end of the tunnel

When new positive trends do arise, the goal is to encourage travel by building trust and increasing willingness. A logical framework that uses data to analyse micro-trends can prepare travel marketers for a personalized approach. Individualized messaging, pricing and services will be more relevant to travellers than a blanket campaign that could come across as tone-deaf at best and irresponsible at worst.

It is important for travel brands to get the inflection point just right - to open the marketing machine - from pushing inventory availability across the distribution network, to optimizing ad spending and pricing, as well as timing messaging and communication directly to travellers. Restart too soon, and money is wasted. Spend too late and competitors take the early, intrepid, customers.

Similarly with ad messaging, each traveller will respond to different messaging depending on a complex interaction of past booking behaviour, demographics, and emotions. For example, residents of countries with strong recovery trends, such as Vietnam and New Zealand, have greater interest and increasingly positive outlooks towards travel, particularly domestic travel.

Having a sensible approach to data analysis and a coordinated marketing effort sets the stage for success. Having a compassionate approach to the individual needs of each traveller ensures it.


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Carolyn Corda

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    About Adara

    ADARA enables consumer brands to make better decisions by delivering critical customer intelligence on intent, spend and value linked to an identity graph. We apply our proprietary machine learning and AI capabilities to ethically-sourced and ethically-deployed data from over 270 global data partners. ADARA drives how our clients personalize interactions with their customers at every stage of the lifecycle optimizing the revenue potential of each individual.

    More information about Adara can be found at

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