I recently found myself in a reflective mood following the chaos of ‘Black Friday’ month (as it really is nowadays) and as we look ahead to the ‘usually’ busiest time of the year – the post-Christmas travel peak period.
This has been a year like no other. Almost everyone in the world has been affected in some way by the coronavirus pandemic and of course, sadly, many people have lost their lives, loved ones, jobs and businesses.
We’ve all had to adapt and we will likely need to maintain this for the foreseeable future. However, there are glimmers of hope out there, as we learn more about the virus, roll out testing more widely and get closer to the use of COVID-19 vaccines.
The travel industry will never be the same again
Travel has been extremely hard hit by the pandemic, like many other industries such as entertainment and leisure activities, hospitality and high street retail to name but a few. My LinkedIn stream has been a wasteland of people being furloughed, losing jobs and travel companies going under.
When almost all business and leisure travel halted in the spring of this year, we saw demand for travel evaporate quickly. Interest still remained in Lockdown 1.0, as people dreamed of holiday destinations, but at much lower levels than previous years.
We’ve had a few false dawns since the first national lockdown, but we (and almost all travel companies) are still running way below last year.
It’s still not clear what the long term damage will be to the travel industry as a whole, but certainly those companies that survive through 2021 will have a very different landscape to deal with.
The key is to refocus and diversify
During Lockdown 1.0 we identified that consumer confidence was going to be key to recovery. We invested time in doing some long-overdue housekeeping on Weather2Travel.com and built a new section on travel advice including country guides with the latest coronavirus stats, local info and useful resources.
We also improved coverage for domestic travel destinations, as it was clear that this would likely recover sooner than international travel. As we came out of the lockdown there was a scramble for UK travel products, although capacity and restrictions meant that it was no ordinary summer.
Recovery has been bumpy since then with increased demand over the summer and autumn months being curtailed by UK quarantine restrictions and the second wave across Europe. The recent news around the rollout of the vaccines and testing strategies have refocused the travel industry on the year ahead.
Looking forward to 2021
There is still much uncertainty ahead for travel in 2021, however currently there seems to be a wave of optimism around the post-Christmas/New Year travel peak.
Many travel businesses live and die based on their performance in January. Future bookings are the lifeblood of travel companies looking for a positive future – the more capacity that can be filled in peak the better.
Travel companies need to navigate the tricky path of matching supply and demand and adapting to quickly changing market conditions. How many travellers can they expect and what type of products are going to be sought after? These are some of the questions that everyone in the travel industry needs to try to answer.
While demand continues to recover, prices are likely to remain competitive, however once critical mass has been reached prices will likely increase. Travel companies need to make up for a desperately poor period, so don’t be surprised if prices begin to rise quickly.
Airlines, in particular, have been badly hit (according to ICAO World Passenger Traffic Evolution report, international airline passenger numbers are down 65% globally in 2020). How airlines react to market conditions in 2021 will dictate how holiday products perform.
The challenges of being a travel publisher
We faced many challenges this year beyond a drop in traffic and sales, as travel brands reduced promotional activities and advertising budgets. Some affiliate programmes were switched to zero commission rates, and in some cases these 0% CPAs are still in place – not helpful to content publishers.
One of the biggest challenges we face is that payment terms are almost always after travel, so sales for summer 2021 and beyond do not help our short term cash flow. It’s important that travel brands are aware of these constraints, especially if they see affiliates as a vital part of their promotional eco-system.
Although promotional activities have restarted for most travel brands within the affiliate industry, there still seems to be a reluctance to push budgets into tenancy. However, we are seeing average spend increase and consumer confidence return, so it’s never been a better time to invest in tenancy and content.
Things are changing very quickly, almost daily, with news of changes in border restrictions, testing policies both in the UK and in-destination. Travel brands and publishers need to react to these changes.
This makes it very volatile to be a content publisher in travel, as content can become obsolete extremely quickly. Destinations that are popular one minute might drop off the cliff the next. So it’s important for publishers and travel brands to be open and adaptable with their partnerships. Just look at how the USA has dropped off as a destination in 2020 as the virus has taken hold.
We have a chance to get it right
People are desperate to travel but need to be reassured that it’s safe and their holiday won’t be too disrupted. The vaccine will be the long term solution for the travel industry but, in the meantime, testing and preventative measures will be part and parcel of our holidays.
Consumers are likely to spend late-December and early-January making plans for holidays in 2021. Researching destinations and travel products is going to be vital and is, therefore, a massive opportunity for travel brands to engage through content with prospective clients.
Travel brands need to look at the type of promotional activities they run, especially content partnerships. Brand voice during the travel peak is vital, especially when demand is likely to go through the roof in early 2021. Content activity is a great way to get core brand messages out to consumers, especially when they are looking for reassurance before they book.
If flexible content plans can be agreed that allow us to quickly react to world events, we can move towards the post-Christmas period with confidence. We all have the opportunity to perform strongly in the travel peak period, so our preparation in the next few weeks is vital.