Euromonitor's Emerging Travel Trends released at WTM 2012
On November 5, Euromonitor, the world's leader in strategy research for consumer markets, released its World Travel Market Global Trends Report 2012 at the World Travel Market in London. Here are the highlights:
Travel technology: The power of smart TVs
Online bookings recorded another healthy performance in 2012 across all travel sectors. Advanced economies dominate online travel sales and continue to record strong growth, while developing economies still lag behind, but are finally showing a steady performance. Online hotel reservations achieved the highest increase, driven by online travel agency sales, while air transportation continues to be the most successful category in online travel.
Smart TVs are about to take off. Samsung, LG, Sony, Panasonic, Sharp and Toshiba launched their first smart TVs, which will become increasingly sophisticated in the future. Similar to smartphones, smart TVs integrate television with internet technologies and social media. The days of TV as a one-way entertainment medium will soon be over with new TV models allowing full interaction between viewers and broadcasters, advertisers and app developers, as well as among viewers themselves.
Viewers and companies will be able to share their videos and even create their own internet TV channels to be easily watched via smart TVs. In the future, people watching travel programmes will be able to make immediate bookings through their smart TVs via travel apps or web links. Travel players will build on the emotional connection provided by TV programmes, offering viewers the chance to book the destination or hotel they just saw and liked.
Global village: Digital detox
With the growing penetration of smartphones, tablets and smaller laptops, consumers are addicted to their devices and as a result, hotels now offer digital detox holidays. The Our Mobile Planet report by Google indicates that in the United States, 80% of smartphone users have not left home without their device in 2012, while 13 million Britons suffered from “Nomophobia” (no mobile phobia), feeling stressed when their mobile was out of battery or service, or lost.
In a time when technology is an intrinsic part of everyday life, hotels may look at digital detox packages as a means to improve guest wellness, helping them to check in and switch off. Technology-free spas, cruises and safaris present strong opportunities in the digital detox arena, as these offer an ideal context for consumers to disconnect and relax. Promoting family time or quality “human” time with loved ones is another aspect of the digital detox offering, as electronic devices weaken human communications in everyday life. The digital detox trend challenges technology integration witnessed across much of the travel industry, as airlines, for example, start to provide on-board Wi-Fi.
Americas: The attraction of forbidden lands
Despite weak economic recovery, the US is expected to continue to experience growth in domestic and international demand for travel.
Since 2010, countries previously off-limits to American tourists have become open; benefiting economically from tourism revenue with many visitors following responsible tourism guidelines.
American visitors are increasingly seeing authentic and unique experiences and Baby Boomers are expected to lead the way, given their time, resources and preference for more active and off-the-beaten-track holidays. Terry Dale, president of United States Tour Operators Association comments: “Countries such as Cuba recognise that tourism is an important economic engine, but also understand that tourism can bring cultures and people together.”
The UK: Tingo rips up the rule book
After two consecutive quarters of negative growth and declines in construction and industrial output, the UK economy slipped back into recession in April 2012 but the World Travel Market 2012 Industry Report has revealed more than half, 52%, of the 1 001 UK holidaymakers polled took more than one holiday this year, many of them to long-haul destinations.
Setbacks in the Eurozone remain a significant threat to the UK’s prospects and financial stability and the weakening economy has hurt consumer spending severely. Private final consumption of goods and services incurred by resident households fell by 1.7% in real terms in 2011 and unemployment reached 8.0% in 2011 and will rise to 8.4% in 2012 – one of the highest jobless rates in decades.
To remain competitive companies are re-thinking old business models aimed at a more passive role for consumers to a more consumer-centric model.
A rising trend in UK online bookings is www.tingo.com (owned by TripAdvisor) – based on a new business model, exploiting refunds and cancellations to gain the best hotel rates. The website uses Expedia Affiliate Network and automatically rebooks travellers’ reservations when there is a price drop for the booked rooms up to 24 hours before check-in.
Europe: BRIC's grand shopping tour
Concerns about economic instability in the Eurozone continue to impact tourism demand, with Southern Europe in recession in 2012, leading to a regional slowdown. Limited tourism growth is expected for 2013, with a minimal difference over 2012. Countries are therefore increasingly looking to BRICs to boost arrivals and spending.
Brazil, Russia, India and China are embracing shopping tourism in key European destinations. Dynamic economic growth has led to rapidly increasing disposable income levels in these countries. Together with increased awareness of an improved quality of life, consumers from BRIC countries are keen to spend more on travel. France, Italy, Germany, Switzerland, Spain and the UK will witness the strongest gains in BRIC arrivals.
South Africa, as part of the BRICS, is also predicted to show increased departures to Europe (4% CAGR 2012-2016) with the strong Rand favouring shopping tourism.
Middle East: Rise of shopping hotels
2011 was a difficult year for the Middle East across all travel and tourism categories, with arrivals declining by 10%, and hotels suffering the biggest decline of 15% in sales.
A new trend has emerged where hotels are moving from being “near” to being “inside” malls or connected to them for easy access.
Big spenders with cash are driving this trend. Wealthy consumers from Bahrain and Saudi Arabia have disposable income and love shopping, thus mega-malls in the Middle East are booming. Shopping malls and associated hotel developments are key elements in the recovery of tourism.
Africa: Destination Nollywood
African economic growth outpaced the global average in 2012, boosting disposable incomes. The region is poised for continued strong growth in arrivals, incoming tourist receipts, and air and hotel value sales in 2013. Intra-regional travel is crucial for the African tourism industry, due to strong business, linguistic and cultural links between many countries.
Nigeria's massive film industry, dubbed Nollywood, is the world's second largest film industry in volume terms, after India's Bollywood and ahead of Hollywood, with more than 2 000 films produced annually. The increasing popularity of Nollywood, that has helped to change stereotypes about Nigeria, by highlighting its culture, norms, creativity and hospitality, will be a major growth driver with the leisure sector attracting film fans.