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World Travel Market 2011: eight key trends in global travel

World Travel Market 2011: eight key trends in global travel (Forimmediaterelease.net) Cape Town Tourism just concluded four fruitful and insightful days at the World Travel Market (WTM) in London, one of the leading global events for the travel industry. Almost 48,000 senior travel industry professionals, government ministers, and international media, embarked on ExCeL-London between November 7-10 to network, negotiate, and discover the latest industry opinion and trends at WTM.

Said Mariette Du Toit-Helmbold, Cape Town Tourism CEO: “The international tourism industry provided more than 235 million jobs last year, representing 8 percent of international employment. Despite economic uncertainty, tourism will remain a significant international economic driver with international tourist arrivals forecast to reach 1.8 billion by 2030.”

At the Global Trends Report at the World Travel Market 2011, several key emerging international travel trends were discussed.

Divided into geographic areas, the report, published by Euromonitor International, indicated the different ways the travel and tourism industry are reacting to both the global economic downturn, as well as political and social unrest such as in the Middle East.

Global arrivals are predicted to slow down 5.8 percent from last year but by 2012 are anticipated to break the one billion arrivals barrier—accumulating in a total spend of almost US$1 trillion. The global overview was of “recovery on the brink” with many analysts anticipating a double-dip recession, specifically in Europe. The International Monitory Fund predicts a 4 percent global GDP growth in 2011, down from 5.1 percent in 2010. Rising fuel and commodity prices, taxation, austerity procedures, political turmoil, and social unrest are all reported to have contributed to the slower GDP growth. Across all markets, online marketing is considered to be the most significant growth area in the long term, with applications on social media and mobile devices very lucrative in the medium-term.

The following key trends are reported per region:

NORTH AMERICA: MYSTERY TRIPS

The need to escalate the excitement of travel is fueling a rise in mystery trips that are premium in price and are for popular milestone vacations such as honeymoons and birthdays. The mystery trips range from customers bidding on packages with an unknown destination and hotel name, to being handed a smartphone unveiling the itinerary day by day, according to their preferences and budget. Travelers pay only 50 percent of the sales price, and suppliers benefit from selling excess capacity without undermining their brand. Luxury Link’s mystery auction and American Express’ Nextpedition provide hotels, airlines, and online travel agencies to sell excess capacity in an opaque bundle that “brings back the element of surprise to travel experiences.” Millennials aged 20 to 34 are the main target of mystery trips, for whom luxury operators review customer profiles and customize mystery experiences in often new and unknown destinations.

UNITED KINGDOM: RENT A GARDEN

The outlook in the UK remains bleak with a stagnant economy. Travelers are progressively searching for alternate accommodation options such as campsites and hostels. Value remains key in the travel decisions of Britons. A growing alternative is garden camping, in which Generation Z and the baby boomer markets rent garden spaces in which to camp out. Campinmygarden.com is growing in popularity and provides listings of individuals and establishments that rent their gardens for camping purposes.

The issue of pricing in the lead-up to the London Olympic Games is high on the tourism agenda. The report found that some London hotels are charging five times more during the Olympic period, with the International Olympic Committee taking around 40 percent of hotel availability. Consumers were said to be becoming more ingenious and bypassing high hotel rates with “peer-to-peer transactions tapping into the zeitgeist of what consumers are looking for.” The tourism industry in the UK is looking at South Africa’s World Cup experience in terms of pricing and capacity, and similarly to the World Cup, the Olympics are reported to be “a once in a lifetime opportunity for the UK travel industry,” whereas in the UK, hotel growth was found to be -5.4 percent in 2010 and -0.1 percent in 2011. 2012 predictions were up to 2.1 percent.

EUROPE: LUXURY WITHOUT THE GUILT

Following the global economic crisis, a new kind of luxury tourism is emerging in Europe – more authentic and ethical with a focus towards “luxury without the associated guilt.” Responsible and sustainable travel is high on the agenda with around 50 percent of the European luxury outbound market demanding responsible tourism practices when traveling. There is an increase in the use of “living walls” and “vertical farms,” whereby luxury hotels have their own kitchen gardens and implement community support in a local produce growing and social empowerment movement. In Europe the high-end segment is outperforming its mid- and lower-tiered counterparts.

The European region as a whole is threatened by a double-dip recession, with increased volatility in the financial markets. Despite this, GDP growth remained realistically stable at 1.8 percent in 2010, 1.5 percent in 2011. It is predicted to be 1.4 percent in 2012. Spain, Italy, and other bailed-out countries Ireland, Greece, and Portugal continue to suffer with high debt and unemployment.

MIDDLE EAST: REBRANDING

The political and social unrest in the Middle East resulted in a 6.2 percent decline in tourism arrivals in 2011 compared to 11.5 percent growth in 2010. Countries such as Egypt and Tunisia are placing considerable focus on country and regional rebranding exercises. Tourism rebranding processes are complex due to each country’s unique political, economic, and social conditions, with the major challenge being how to change perceptions of the region. According to the Global Trends Report, comprehensive rebranding campaigns will yield a bounce back in travel for the Middle East – a popular region for travel from Europe.

Egypt’s tourism board are implementing an international branding and marketing campaign, Bahrain’s summer festival attracted more than 85,000 visitors, and it is predicted that post-Gaddafi opportunities will emerge Libya after a widespread renewal of the country’s tourism infrastructure.

Tourist arrivals in the Middle East are expected to increase by 1.3 percent during 2012.

AFRICA: MOBILE COMMERCE BOOSTS TRAVEL

Africa is leading the world in M-commerce, with 60 percent of mobile web users using mobile phones to purchase goods. Mobile-phone money transfer service M-PESA in Kenya targeted unbanked Africans to book travel via phones. The upwardly mobile population means that Africa is leap-frogging earlier forms of media and taking travel to those who were traditionally excluded from it. WTM Chairman Fiona Jeffery said: “The continent of Africa has tremendous potential for the global travel and tourism industry. With blue-chip corporations such as IBM and Vodafone involved in building a mobile commerce network, regional and global travel companies should be looking even more closely on what the region has to offer. Mobile payments systems are commercially and economically important for all sectors operating in the region, with travel and tourism ideally placed to take advantage.”

In 2010, airlines such as Kenya Airways and Uganda Airlines joined M-PESA and Airtel Money to enable consumers without a bank account to buy air tickets.
During 2011, real GDP growth in Africa was more than 5 percent, driven by economic development and backed by a growing disposable income.

ASIA AND CHINA: GROWING INFLUENCE

Asia’s economies continue to enjoy healthy growth. Spending by Chinese travelers on travel accommodation domestically and abroad is expected to increase by 20 percent over 2010/2015 to reach US$67 billion, second to the USA. Hotel companies are customizing their brands in China, partnering with Chinese companies, and creating programs to cater to the Chinese abroad.

Intra-regional travel is high on the agenda for Asia and is expected to boost arrivals and incoming tourist receipts as more middle-class travelers explore the region for the first time.

TECHNOLOGY AND ONLINE TRAVEL: GAMIFICATION

Gamification, or the integration of gaming dynamics in non-gaming environments, started in the US entertainment industry and is now a growing movement in the travel and tourism industry. By encouraging consumers to join competitions and share their experiences, photos, and videos, the trend generates brand awareness and loyalty for destinations. It works through the offering of points, badges, and real-life gifts, with some websites allowing web users to explore a region’s attractions, complete challenges, and win trips to the desired region.

Gamification appeals predominately to 18-34 year olds and allows destinations to target specific markets, build awareness, grow an online community, and add information, competition, games, and special offers. The report gave an example of Tourism Ireland’s “Ireland Town” game on Facebook, where users can visit distinguished tourist attractions in Ireland and share the experience with their friends. The “Ireland Town” campaign plans to engage 60 million people.

GLOBAL VILLAGE: EVOLUTION OF SOCIAL MEDIA

Social media was at the forefront of tourism marketing activity during 2011, leveraging offline events to interact with online audiences. Social media focus is shifting to loyalty programs, bookings, concierge, and customer service, and the aim is to capitalize on its power and friends/followers’ influence to drive bookings and build loyalty. Hotels are rethinking their marketing strategies to target online audiences in a more tailored and intimate way. An upsurge in hotel chains utilizing social media during 2011 was reported. Global hotel chains are providing social media care teams and creating targeted events. For hotels, the benefits were seen as helping enhance brand awareness, opening direct lines of communication, and enabling them to aim exclusive offers to online followers. Uncertainty remains about how to determine return on investment for social media.

MEDIA CONTACT: Cape Town Tourism, PR and Guest Relations Coordinator Hannah Deall, Phone: +27 21 487 6800, Email: hannah@capetown.travel , Web: www.capetown.travel ; Rabbit in a Hat Communications, Tammy White, Phone: +27 21 448 9705, +27 73 202 5041, Email: tammy@rabbitinahat.co.za

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