In the blink of an eye our world was turned upside down due to COVID-19 in March of 2020. Now, almost a year and a half later, there’s a light at the end of this tunnel as vaccines continue to get rolled out all over the world. What’s been top of mind for most has been to travel after lockdown. Being quarantined for the last 16 months has definitely had an affect on people’s travel expectations and behaviours. And what about business travel? Will business travel after lockdown be as lucrative as it once was? Today, we talk about consumer trends and thoughts on travel in a post-COVID world.
Deferred Demand
The topic of revenge travel and deferred demand has become prominent as we begin to see the tail end of this pandemic. The GlobalWebIndex (GWI) found that 60% of people are itching to be able to enjoy things such as live events and travel after lockdown, as soon as it’s safe to do so. Contributing to this is the rise in consumer confidence. GWI also found that 56% of people are confident about their nation’s economy in Q1 of 2021 compared to 46% in Q1 of 2020. Skift found that 45% of Americans say that they are willing to increase spending on travel. People appear to be becoming less price-sensitive after a year of increased restricted spending and financial strain as the world begins to reopen.
To a certain extent, many people are experiencing digital fatigue, from the long work from home hours, countless zoom meetings, and virtual hang outs. But several consumer trends have emerged from this period and are predicted to remain as the world reopens.
E-commerce and contactless deliveries became the norm during the pandemic with most people developing new routines involving shopping, eating, groceries and contactless delivery. We also saw a surge in hybrid events or completely remote live stream events like concerts and conferences. We predict that these hybrid formats will continue well beyond the pandemic as it caters to a broad type of audience, increases participation and attendance and is a cost effective option for both parties.
Business Travel
In 2017, Statista found that 30% of all travel was business travel with spending estimated to be at $1,657 billion by 2023 (pre-COVID predictions). Business travel is big business but what about business travel after lockdown? How has the pandemic affected consumer behaviours in this regard?
In Feb 2021, STR conducted a study of over 1300 participants and to consider their likelihood of business travel after lockdown and the pandemic was over. The response geared towards more negative than positive as over a quarter of participants planned to travel less for business relative to their pre-pandemic business travel habits. One of the primary reasons being with the transition over to video conferencing technologies to carry out business meetings and events decreases the need to actually have to physically travel for business. Businesses also realized the major cost savings in 2020 with most of their teams working from home.
In contrast, 17% of participants said they would be more likely to travel in reaction to being forced to stay at home for more than a year. They explained that there is a pent-up desire to reconnect with clients and prospects and make up for lost time and gain an advantage over competitors. This group also expressed interest in connecting with remote team members in person after being separated during the pandemic.
In this small sample, we see contracting responses however it is important to note that there were also five participants that said they were “unsure” about their level of travel after lockdown due to the fact that they are still currently working from home and found it hard to predict their level of post-pandemic business travel.
To summarize, it seems as though customer confidence is definitely growing as we head into Q3 of 2021. Leisure travel seems more likely to rebound before business based on these statistics. However, only time will really tell as we navigate a post-COVID world.
