A recent report by Bankrate in the US showed that affordability is cutting into traveller choice and more recently southern European sun-and-sea destinations have reported a slowing in bookings that wasn’t quite anticipated this early in the season.
In other words: so-called ‘revenge spend’ is probably waning. So what can those who have been enjoying this ‘boom’ do to make sure that they don’t experience too hard a ‘bust’?
Travel technology industry experts from around the world give their tips and insights on how to adapt best. The CEO of Digitrips – the leading multi-product B2B travel platform – Emilie Dumont highlight that “whilst the boom might be fading out, agents and other types of B2B sellers still have a positive future: the appetite for travel is still there, just people’s needs and budgets are changing. The right technology and tools can help B2B and B2B2C sellers to showcase a broad range of travel options that appeal to all travel budgets, now is the time to leverage capabilities of tech-enabled platforms to identify best deals and secure sales with fintech options such as flexibility or BNPL (buy-now, pay-later)services, and get ahead in what is likely to be a return to a very competitive environment.”
Alex Gisbert, Fastpayhotels – a B2B platform for travel sellers and hotels globally – agrees with this and adds that: “Everything points to an inevitable shift in traveller behaviour, but we knew that would happen didn’t we? It’s clear that as interest rates continue to rise and inflation still won’t come down disposable income will falter. Continue offering maximum amounts of relevant choices to travellers and do so through segmenting and harnessing data to better understand their needs.”
In the post-pandemic world Janis Dzenis from price comparison website WayAway feels that “loyalty and discounts have become key elements in enticing cash-strapped travellers to book their next trip. While the hype of ‘revenge travel’ has waned, by maintaining an unwavering commitment to loyalty and providing discounts where feasible, travel suppliers and agencies can continue to attract customers while also weathering the shifting landscape of the travel industry.”
Meanwhile focusing on room rates only is too short-sighted says Alex Barros from hotel revenue manager BEONx. Instead he recommends getting travellers to book travel at a lower price point, but then maximizing profitability by cross-selling other services. Barros feels that “by offering personalized suggestions for add-ons or upgrades, travel suppliers can create a win-win situation for both themselves and their customers.”
Talking about the potential even for cancellations, rescheduling to later in the year or changes to cheaper room types, Sebastien Leitner, VP of Partnerships from Cloudbeds – a provider of technology to independent hotels – feels that: “Whilst non-refundable room rates might be a tempting solution, don’t just jump in there without considering all the options. Often the best thing is to offer both refundable and non-refundable, ideally using technology to consider which is more likely to be appealing for that traveller based on the channel they’re booking via, types of prices or rooms searched for, the source market, or any other details you have on the traveller.”
Ticketing changes and cancellations would mean more costs for travel businesses when it comes to the payments side of things, whether that be admin or actual charges for a B2B transfer warns Spencer Hanlon from global real-time payments platform Nium. He also points out that often bank charges have flat minimum fees regardless of payment amounts, “your average sale value might have fallen 30% but your bank charges you the same to settle with the airline or hotel”. Spencer feels that there has never been a better time to invest in efficient payment technology for this reason alone.
As a final thought on the matter, one area where it would be tempting for travellers to cut costs could be insurance policies. Whilst this would be short-sighted,Katie Crowe from travel insurer battleface feels that it is the responsibility of insurers “to consider unbundling their benefits so that travellers can pick and choose the coverage most specific for their needs, and drop parts they don’t want, to make policies much more relevant and competitively priced for the needs of the cost-conscious traveller.”
