Travel Trends

Discount Air companies struggle with high oil prices

The collapse of Zoom, a Canadian budget airline, last week stranded passengers and threw the travel plans of many others into chaos. But other airlines stand to benefit. read more»

Of smartphones and social travel

Two important new travel trends are the spread of GPS-equipped smartphones and the increasing popularity of "social travel" tools. In New York, Gulliver went to an informal panel discussion on "The Future of Travel on the Net" to bring himself up to date. read more»

More trends

1. Travelers demand or expect the same level of technology in their hotel rooms as they have at home (or even more). The majority of households in the US have broadband internet, many cable channels on TV, flat-panel televisions, wireless connectivity for their laptops, and cell phones. In addition, many have handheld devices that connect to their home and cellular networks, as well as VoIP handsets. These travelers will want access to these technologies in their hotel rooms, with the options of using their own devices or accounts. For example, US-based travelers are now able to use their cell phones in many international destinations. Many people are bringing their vonage devices into their hotel rooms with them in order to make "free" phone calls.  Hotels must be prepared to offer these things as a commodity in order to compete over the next several years. Any hotels that do not offer these features will be passed over by these more sophisticated travelers, and the travelers will become more and more sophisticated over time.  For example, there are hotels in the US that still charge for their internet access, but I personally will pass them up and go to the ones that offer it for no additional charge. It has only been 7-10 years or so that hotels have even made wireless available, and today it is a commodity.
2. Vagabonding - This growing trend in travel is changing the way people think about using their vacation days. The concept suggests that long-term travel is more meaningful and memorable than the 1-2 week vacation that’s standard in Western culture. Through taking extended (and often times independent) vacations in out of the way locales, vagabonders can recharge by discovering and experiencing the world on their own time. Apparently it’s not as difficult as it sounds to take a couple months off from one’s normal life. There are books, guides and online communities that offer tips on everything from how to manage travel funds to how to find a safe subletter to help with the rent
3. growing trend among Gen Y and empty nest Bomers called VOLUNTOURISM - combining traditional travel /sightseeing with actually working to help the country you are visiting - mainly taking place in third world and emerging countries. These "tourists" might work in AIDS hospices in Africa, or teach students English or work with injured animals on a wildlife preserve. in the last few years they have participated in rebuilding efforts after the Asain tsnumai and Kashmir earhtquakes.
4. Have also seen several recent articles on the growing popularity of GRIEF TOURISM - planning trips to places like the World Trade Center, Killing Fields of Cambodia, concentration camps in Germany, etc.
5. MICRO and POP-UP HOTELS are another category I have seen quite a few writings about lately - these seem to be a step-up or upgrade from the traditional hostel-type place. This provides more options for the budget traveler. Tune Hotels in Kuala Lumpur offers a "no-frills" $2 U.S. a night room
6. Social networking sites will become of increasing importance in decision making for the consumer purchasing holidays. These will include sites like facebook/trip advisor etc.
7. Loyalty will continue to decline due to access to information and customers will become increasingly more proficient at shopping around in the online environment.
8. Luxury/specialist travel will continue to grow the only hinderance to this would be an economic downturn. Consumers are increasingly spending more on travel and perceive this as a lifestyle choice.
9. Consumers are looking to become greener, this is begining to effect decision making in some social groups but this will not significantly effect travel. Consumers are more likely to look for organic meals choices, good recycling policies, investment in local communities from the places they stay in, hotels and companies will adjust to this to maintain competitive advantage.
10. The biggest impact and shift in the industry will come from the growing middle class groups in developing countries such as India, China, as the value of these groups travel spend becomes realised the industry will start to adapt to serve the needs of these countries.
11. Space treavle etc will not impact the industry its only certainly for a significant number of years only going to be of interest to the mega rich, and personally I think if we could not even sustain Concorde flying anticipating space travel will be here to last on a broader commercial basis is a fools gold. 

Developing World travelers

1. More travelers coming from the developing world.  I think the #1 trend I am seeing is that BRIC nations like Russia, India and China are growing increasingly large segments of their populations that have the wealth and inclination to travel abroad.  Anecdotally, on holiday in Bali recently, I met relatively few Americans and Western Europeans. However, the number of Asians (Chinese, Taiwanese and Indians) and well-to-do Russians I came across was startling.
2. In the next 5 to 10 years, China, India and the ASEAN region will account for the largest growth in the global economy. Coming on these heels is the growth of a stronger and bigger middle class who now have the financial needs to travel the globe and visit tourist destinations within Asia and beyond. Right now, South Korean tourists have dislodged the Americans as the biggest number of tourists that enter The Philippines. I believe the situation is the same everywhere. The growth of many emerging economies in Asia have spawned a new middle class who are willing to spend and travel the world. The biggest growth for the travel and tourism industry will come from this new segment.

Rejection of "main-stream" tourism

I think we are nearing, within a generation, the onset of a paradigm-changing "Commons Effect" in tourism. [A historic theory called "Tragedy of the Commons" proposed that we are, in effect, doomed always to kill the golden goose. In other words, the value of any asset which we deploy for the common good (whether common land for grazing our animals - hence "commons" - or a really beautiful tourist destination) will, over time, be extinguished by its own popularity.] Mass tourism is a potent destroyer of pathways, ancient monuments, fragile works of art, etc. and it is quite possible that chain-hotel culture will similarly erode the charm of exotic locales. I don't see eco-tourism as anywhere near genuinely getting to grips with this problem; it mainly looks to me like a CSR (Corp. Soc. Responsibility) fig-leaf by the big travel companies. Tell me I'm wrong though, please!

Space Tourism

Space tourism is taking shape as an emerging industry that will be cutting edge in 5-10 years and main stream in 20. The Middle East is host to one of the first few space ports for suborbital tourism. While this is about $30 million a year in 2007, it rates to be more than $1 billion/year in 2027 in current dollars. There is a Futron Study on this which was from 2004, later revised in a white paper. While $300 million/year is small beer for the Middle East, if the site chosen is viable for orbital launches, it will become the new port city to a major growth zone for the latter half of the 21st century.

The sub -orbital space flight. which is spending some time in the edge of the envolepe for 5-10 minutes. there are various firms competing for this and there is also the famous X-prize for the same. by 2009 it should be a reality. the major contendor for this is Sir richard brasnon's virgin atlantic and AIRBUS- astrium. so by 2011 when the traffic picks up the prices will come down and it will be a huge potential space for companies to cash upon.

Travel Sales Still Growing, but Numbers of Customers Are Declining

THE online travel category is still rolling along, but there may be trouble ahead.  Like other e-commerce markets, travel is expected to produce double-digit sales growth this year in the United States, but unlike other major segments, this one is actually losing customers. According to a recent survey of more than 60,000 Internet users in the United States by Forrester Research, a technology consulting firm, 9 percent fewer people booked travel online this year than in 2005. It is the first time since Forrester began tracking Internet spending a decade ago that a category has lost shoppers.  “This is a wake-up call for the industry,” said Henry Harteveldt, Forrester’s online travel analyst. “Customers are tired of spending two or three hours trying to find the airline or hotel or vacation package that meets their needs.”

Of the four major online travel agencies contacted — Expedia, Travelocity, Orbitz Worldwide and Priceline.com — only Orbitz and Travelocity disclosed statistics about their domestic customer bases. Both said they had increased, but neither would disclose the extent of the growth.  Forrester’s findings were echoed by research that was expected to be published this week by PhoCusWright, a travel consultancy based in Connecticut. PhoCusWright found that among travelers with access to the Internet, the percentage who usually book travel online dropped to 62 percent at the end of last year from 68 percent in 2005, while those who say they usually arrange travel offline increased to 31 percent from 25 percent during the same period.

Industry revenues are still strong, mostly because those consumers who book travel online are doing more of it. According to the Forrester survey, the average online booker said he or she would spend 50 percent more on travel this year than in 2005. Fans of the bottom line may not be alarmed, then, that some customers have lost their taste for online travel agents, especially if serving the remaining customers proves more profitable. Customers who never call the company for help, for instance, are considerably more valuable than those who do.

But Mr. Harteveldt said companies that relied on a shrinking base of customers would lose ground if they did not help online travel bookers overcome some longstanding hurdles. In particular, he said, online travel agencies and sites from airline, hotel and rental car suppliers rely on the same approach they used a decade ago: they require shoppers to type in their travel dates and locations and wait for a list of options that may or may not fit their budgets or needs.

The search engines of travel sites do not do enough to take other factors into consideration, Mr. Harteveldt said. “Nowhere can you say, ‘I have this amount of money to spend on a trip. These are my interests. This is where I live. Show me my options,’” he said. “Whereas online retailers have done a much better job of improving the shopping experience in recent years, the travel industry has been standing still.”  Online travel executives say part of the reason for the dearth of innovation is that the online travel reservation systems are largely extensions of technology built in the 1960s. Those systems were intended to quickly execute searches and transactions by handling small bits of information at a time, rather than including many bits of data about someone’s travel preferences, for instance.

Travel sites have, for years, spoken about their quest to offer more personalized trip ideas and bookings based on such preferences, but with few tangible results. Now, independent technology companies are starting to enter the market with their own services.

Last week, for instance, LeisureLogix, based in Southlake, Tex., a technology company led by veterans of the online and travel industries, introduced a personalized search product for road travelers called the “Road Trip Wizard.”  The service made its debut on Travelocity (travelocity.roadtripwizard.com) and is to appear on other travel Web sites in the coming months. It asks travelers to select attributes that best describe their interests and trip preferences, and it returns an itinerary, including maps, driving directions, tourist attractions and hotels. Hotels can be booked through the service. Tickets to tourist attractions are to be added as the attractions improve their online booking systems.

Michael Hulley, the chief executive of LeisureLogix, said the service was among the first to tailor a trip to a traveler’s interests and needs. “This is based on the entire travel experience,” he said. “It’s not just about the destination, but the things you do along the way.”  Andres Fabris, Travelocity’s vice president of business development, said the new service would help the company tap into a market it had overlooked. Travelocity, which is owned by Sabre Holdings, regarded travelers who drive as less lucrative than, say, airline travelers, but it recently discovered that 85 percent of road travelers book midscale or upscale hotels.  The personalized approach of the Road Trip Warrior service is something, Travelocity is working to incorporate into other recommendation services on the site, Mr. Fabris said. “It’s certainly very compelling to be able to establish your persona and preferences,” he said.  Lorraine Sileo, an analyst with PhoCusWright, said the LeisureLogix technology was “a good advancement.” But, she added, the information it presents to travelers must continue to be comprehensive if it hopes to yield well-tailored results to users. “Hopefully, LeisureLogix can do that,” she said.

Travelocity’s competitors, meanwhile, claim they are already making significant, if sometimes overlooked, improvements in the travel booking process. Orbitz, for instance, this year introduced sections of its Web site devoted to “Road Warriors” and family travelers, with lists of hotels and destinations deemed suitable to those groups.  Expedia, too, said it had simplified and personalized the booking process. According to Paul Brown, president of Expedia North America, Expedia suggests hotels based on whether it thinks the customer is a business or family traveler, among other things. If the customer’s search suggests he is staying midweek for one night in a city, for instance, Expedia will show him hotels near business centers.  “I won’t say there aren’t upsides to understanding more about the person traveling,” Mr. Brown said. “But we believe knowing about the occasion behind the trip, in many cases, is more important.”