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The travel market is growing fast and changing dramatically. With the
Internet, emails, mobile phones and other communications technology so much
a part of our daily lives, a whole world of information and choices are
available to today’s travellers. Therefore, it is not difficult or uncommon
for consumers to now do their own pre-trip research and plan their own
vacation - welcome to the world where the traveller is in charge.
Abacus President and CEO, Don Birch observed, “In the last 10 years, new
inventions and major technological advancements, have greatly altered the
way people live, move and play. Consumers today are more sophisticated and
want to take charge of everything - including their travel trips. That’s why
it is critical for travel agents to innovate in order to understand and
serve the customers of the future.”
A new breed of travellers
Rising incomes have created a breed of sophisticated and affluent
consumers who are better educated, have more disposable income and
appreciate the value of travel.
In his whitepaper “Asia Pacific Tourism Industry: Current Trends and
Future Outlook” 1997, Amrik Singh, instructor of Department of Parks,
Recreation and Tourism, University of Utah, Salt Lake City, noted that
disposable incomes in Asian countries have soared as a result of strong
economic growth. An inclination to travel follows as travel is no longer
seen as a luxury but as an affordable commodity, a status symbol and a form
of relief from work.
Changes in demographics are also leading to varying travel patterns.
For example, as more women enter the workforce, they enjoy greater
spending power and thus travel more often. According to recent research
conducted by MasterCard International, the ratio of male to female
travellers has changed from 90:10 in 1980 to 60:40 in 2004. MasterCard
noticed three distinctive groups among the female travellers – young single
women travelling in self-organised groups; mother-daughter travellers; and
older singles travelling in groups. Whether it’s shopping in cities or
relaxing at beach resorts and spas, they all spend good money. In fact,
MasterCard predicts that retail spending in
Hong Kong,
Seoul,
Bangkok and
Singapore will hit US$13.4 billion in 2011.
Similarly, a greying population and longer life spans have resulted in an
increase in retiree travellers.
Customised travel plans to meet individual needs are also set for strong
growth. The number of Free and Independent Travellers (FITs) is growing fast
as customers are willing to spend more on customised vacations. Atrium Eco
Travel, which specialises in customised tours, said that tailored tours make
up 80% of its business and this has been growing by 20 to 25% annually since
2002.
Online travel has also experienced phenomenal growth in recent years. In
online travel company, ZUJI’s annual Travel Survey 2003, 48% of Singaporeans
had made travel bookings online, with 36% indicating that they will do so in
the future. Furthermore, ZUJI’s current booking patterns showed that almost
30% of all online bookings and purchases on ZUJI are made by repeat
customers.
Growth in Asia Pacific travel
Robust economic advancement, lifting of political restrictions and
liberalisation of air travel, are just some of the factors that are
propelling the tourism growth in Asia Pacific.
The arrival of low cost carriers has now also made travel affordable for
the previously untapped (low-income) market segment. In Singapore, for
example, four times as many low cost carrier passengers landed in Singapore
in the first five months of this year over the same period last year
(source: New Big Spenders, The Sunday Times, 10 July 2005).
Adding to that, growth in tourism around Asia will be spurred on by new
regional attractions and events such as the Hong Kong Disneyland and the
Beijing Olympics.
This will, in turn, create new marketing opportunities in the travel
industry, such as timesharing, meetings and incentives, ecotourism, cruise,
sports-related travel and spiritual tourism.
In the short and long term,
China will continue to be the main engine
driving Asia Pacific travel growth. In June this year, The World Tourism
Organisation noted that the number of Chinese able and eager to travel
internationally has been growing tremendously. New air routes have opened up
and frequencies have increased to further stimulate both outbound and
inbound travel in China. By 2020, China is expected to be the world’s number
one destination with an estimated 100 million tourists visiting each year,
according to China Travel Service.
Interestingly, experts predict that an influx of tourists from Arab
states will contribute significantly to the region’s growth. Middle-Eastern
tourists generally spend about US$1,000 on their holidays – almost double
that of any other visitors. These huge-spending tourists are now choosing
South-east Asia as “they feel unwelcome in Europe and the US as the world
turns jittery after the London bombings,” (source: Arab tourists flock to
South-east Asia, The Business Times, 12 September 2005).
Malaysia is
expected to attract more than 200,000 Arab tourists this year, a 40%
increase over 2004.
Travel industry must adapt - So what does all this mean for the travel
industry?
At various stages of life, each person has different needs and demands
for travel. For instance, young singles are likely to browse and book
online, so travel agents may need to establish websites to enable them to
capture the online traveller. Family travel is more complex as tour packages
need to incorporate activities designed to cater to the entire family’s
needs, therefore using a travel agent to plan their trip is a preferred
choice. So how can travel agents advise families? And what special
requirements do aged or business travellers have?
“Looking at the diverse needs of different travellers, travel agents must
use different communication channels to engage travellers and address their
needs appropriately,” said Mr Birch.
And despite the strong growth of online bookings in Asia, still only 4%
of total bookings (worth US$1.5 billion) are made online. People throughout
Asia Pacific use the Internet to search for information, but prefer
face-to-face or telephone to make their bookings, resulting in the new
browse online book offline, or BOBO, phenomenon. This means customers still
depend on travel agents to pull together information, recommend the best
options and then help customise their travel plans. Travel agents therefore
need to develop strategies and adopt technologies that allow them to take
full advantage of the traveller’s needs.
That’s why the role of the travel agent is now more important than ever.
Travel agents rely on Global Distribution Services (GDS), like Abacus, to
connect them to thousands of travel service providers. Through access to
such information, travel agents can better add value to their travellers,
providing them with more information and choice so that they can make the
right travel decisions and build stronger customer loyalty.
But in order to customise the right product for the right traveller,
travel agents need to stay close to the trends in how the customer shops for
leisure and business. That way, travel agents will be able to then match
their customer’s expectations.
According to Mr Birch, the traveller of the future will:
Be more socially responsible – today’s traveller supports global issues
and wants to communicate with like-minded people and communities across
regions, learning about other cultures and making a difference in other
people’s lives.
Be mobile – the advancement of technology has made the traveller of the
future more mobile, allowing them to do the things they want to, anytime,
anywhere at their convenience
Want personalised treatment – customers like to feel special. Regardless
of how much they may be paying for service, customers like to believe that
the whole world revolves around them.
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